DHFL is the top loser on the BSE and this does not come as a surprise, given the spate of downgrades it has received.
Yesterday, CRISIL and ICRA, both cut the ratings on the NBFCs Rs.850 crore commercial paper programme to ‘default’ .
CARE also followed it up with a downgrade across all its outstanding borrowings.
The rating agencies have mentioned reasons of increased liquidity pressures, delays in bringing in a strategic investor and very little progress made in generating additional liquidity through builder loan book sell down and securitization.
DHFL has reverted with a surprise over these downgrades. In a statement issued yesterday, the company said, “The action by the rating agencies is extremely surprising as the Company has been making & continues to make substantial efforts in ensuring no defaults on any bonds, repayment of its financial obligations. These actions are unwarranted and the company is seeking clarification on the rationale that predicts DHFL’s inability to service pay?outs on the due dates. Such speculative rating rationale is not adequate. Since September 2018, DHFL has repaid close to Rs. 40,000 crores of financial obligation. To ensure adequate liquidity to meet the repayments, DHFL also sold its strategic retail assets including Aadhar, Avanse and DHFL Pramerica Asset Managers. The company is committed towards ensuring repayment of all its obligations as well as onboarding the strategic partner for its business.”
Obviously the market is not convinced and the stock price opened with a loss of 10% and went on to hit a new low at Rs.94.90.