DHFL Shares Plunge 45%, Wiping Off $1.12-Billion Investor Wealth

As housing finance companies led a panic selloff on Dalal Street in Friday's trade, Dewan Housing Finance Corp Ltd (DHFL) stocks were among the worst-hit on reports that the company had exposure to debt-hit Infrastructure Leasing & Financial Services (IL&FS) group. DHFL was the worst hit among the housing finance companies as it erased $1.12 billion from its market capitalisation. DHFL shares plunged nearly 60 per cent in trade before ending at Rs 351.55, down Rs 259.05 or 42.43 per cent on the Bombay Stock Exchange (BSE). On the National Stock Exchange (NSE), DHFL shares closed at Rs 337.00, with a loss of Rs 273.55 or 44.80 per cent.

Krish Subramanyam, co-head equity advisor at Altamount Capital, was quoted as saying in the Reuters report that rumours about one group "spilled over to other NBFCs (non-banking finance companies)".

Other housing finance stocks like Indiabulls Housing Finance, Can Fin Homes, PNB Housing Finance and LIC Housing Finance also cracked up to 8 per cent.

DHFL's management later refused that it had any exposure to IL&FS group.

"We wish to categorically state that DHFL has not defaulted on any bonds or repayment nor has there been any single instance of delay on any of its repayment of any liability. We do not have any exposure with IL&FS," said Kapil Wadhawan, chief managing director, DHFL.

"Our fundamentals are strong and we hold a strong liquidity of approx. Rs.10, 000 crores in the system which equates to 6 months of cash," he added.

The equity markets witnessed some wild swings in trade, as the Sensex crashed 1,127.58 points before closing at 36,841.60, down 279.62 points or 0.75 per cent. The Nifty50 settled at 11,143.10, with a loss of 91.25 points or 0.81 per cent, before sinking 367.9 points.