Rakesh Jhunjhunwala owned stock surged 19% in high volume

Shares of Edelweiss Financial Services rose 19 per cent to Rs 60.65 on the BSE index in trade during Thursday on the back of higher volumes. The stock of the financial services firm rebounded sharply (21 per cent) from a 52-week low of Rs 50.10 touched in an intraday trade.

at 02:09 p.m.; The stock traded 16 per cent higher at 59.25 rupees, compared to a 0.3 per cent fall in the S&P BSE Sensex. 37.98 million shares of the combined stock representing 4 percent of Edelweiss Financial’s total equity traded on the NSE and BSE exchanges. The names of buyers and sellers were not immediately confirmed.

Contribution pattern data showed that Ace Rakesh investor Jhunjhunwala owned 15.12 million shares or a 1.6 percent stake in Edelweiss Financial at the end of the December 2021 quarter.

The stock underperformed the market by dropping 18 percent in the past three months, compared to a 0.48 percent rise in the S&P C Sensex. In the past six months, the stock has fallen 25 percent, versus a 1 percent drop in the benchmark. It reached a 52-week high of Rs 101 on July 14, 2021 and a record high of Rs 342 on May 29, 2018.

On March 4, 2022, rating agency CRISIL Ratings reaffirmed its rating of Edelweiss Financial’s long-term retail debt instruments and banking facilities to CRISIL AA- / CRISIL PP-MLD AA-r / Negative / CRISIL A1+.

The ratings continue to reflect the appropriate level of capitalization for the group, backed by multiple rounds of capital raising; Diversified business profile with presence across the lending, asset management, wealth management, brokerage, asset rebuilding and insurance sectors; Demonstrate the ability to build a significant presence in multiple areas of business, which should continue to support profits. CRISIL said in its rating reasoning that the group also maintains adequate liquidity on an ongoing basis.

The persistence of ‘negative’ outlook reflects the challenges in profitability and asset quality that the Group is facing in large part due to pressure on the wholesale loan book. Retail loan writers have also been affected amid the Covid-19 pandemic. The rating agency said trends in profitability and asset quality, over the medium term, will be key elements to watch.

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