Gold financing company Manappuram Finance's stock is witnessing a huge decline of 15% today. In the early trading itself, this stock was seen slipping by more than 10%. RBI has banned the company's subsidiary Asirvad Micro Finance from approving new loans and issuing loans. After this, many brokerage firms have given downgrade rating to this stock.

The Reserve Bank of India has taken action against Asirva Micro Finance and three other NBFCs. These NBFCs were not following the rules related to household income and loan liability for microfinance loans. After this RBI has taken this action.

Global brokerage firm CLSA has maintained an Outperform opinion on Manappuram Finance, but has reduced the target price from ₹ 240 to ₹ 200 per share. The brokerage firm wrote in its note that Asirvad's share in Manappuram Finance's AUM is about 25%. RBI's action has led to a cut in Asirvad's profit estimates. In such a situation, Manappuram Finance will also be affected by this. Morgan Stanley has downgraded the Overweight opinion on Manappuram Finance to Equalweight. Also, a target price of ₹ 170 per share has been set. RBI's decision will affect the company's profitability in the long term. The brokerage firm has cut its consolidated earnings forecast for the financial year 2025 by 20%. Also, this cut has been made up to 30% for the financial years 2026 and 2027. The brokerage firm said that even after the reduction in earnings estimates, the valuations are cheap. But, investors may take a long time to show interest in the stock. Jefferies has downgraded the rating on this stock to Hold and has set a price target of ₹ 167 per share. This brokerage firm believes that Manappuram Finance can invest capital in the subsidiary. But, this will affect the earnings of the company. The brokerage firm has reduced the EPS estimate for the financial year 2025-27 by 11% to 19%. Manappuram Finance's stock closed 1.5% lower at ₹ 177.33 per share on Thursday. So far in 2024, this stock is almost flat. The stock has slipped 23% since its recent peak of ₹230.