IDFC shares hit 52-week low on Morgan Stanley downgrade, RBI move

NEW DELHI: IDFC Ltd plunged over 8 per cent in afternoon trade on Wednesday to hit its 52-week low of Rs 117.50 after Morgan Stanley downgraded the stock to "equal-weight" from "underweight".

At 12:00 p.m.; IDFC was trading 7.4 per cent lower at Rs 118.85 in a session marked by declines across financial stocks after RBI initiated fresh measures to curb liquidity.

The stock had hit a 52-week low of Rs 117.50 and a high of Rs 127.30 in trade today.

Morgan Stanley has also slashed its target price to Rs 100 from Rs 150 earlier as the bank expects its funding costs to rise in coming future.

The downgrade comes as Morgan Stanley cuts its loan growth outlook for IDFC and cites an increase of 125 basis points in three-month commercial papers, which would make funding more expensive, Reuters reported.

"The investment bank adds asset quality risk is also increasing for IDFC as the economy slows and rates rise," added the report.