Piramal Enterprises slumps ~13% in 2 session after RBI’s AIF diktat

21 Dec 2023 , 01:29 PM

Piramal Enterprises Limited (PEL), a diversified non-banking financial company (NBFC), witnessed a decline of over 13% in two sessions after the Reserve Bank of India (RBI) tightened investment regulations in Alternative Investment Funds (AIFs) on Tuesday.

Despite the business ensuring that it will set up provisions for certain risks, the stock plummeted nearly 4% to the day’s low of Rs 851 on the NSE.

According to the company’s statement to the markets, PEL and its housing finance subsidiary Piramal Capital & Housing Finance have a combined exposure to AIFs of Rs 3,817 crore as of November 30, 2023.

According to the disclosure, Rs 653 crore of the Rs 3,817 crore invested in AIFs goes to funds that have no exposure to any PEL debtor enterprises. According to the filing, the AIF invested Rs 1,737 crore of the remaining Rs 3,164 crore in three organizations that are (or were in the previous 12 months) debtor companies of PEL.

The business is certain that the underlying downstream investments in the impacted AIF units will be fully recovered.

PEL (consolidated) has collected Rs 905 crore in interest and principal payments on these units.

At around 1.27 PM, Piramal Enterprises is trading 1.17% lower at Rs 875, against the previous close of Rs 885.35 on NSE. 

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