STFC, Muthoot Finance drop up to 17% on Fitch rating downgrade

NEW DELHI: Shares of Shriram Transport (STFC) and Muthoot Finance fell up to 17 per cent in Monday's trade after Fitch Ratings downgraded long-term issuer default ratings of the two NBFCs on increasing macro-economic challenges, citing the coronavirus outbreak.

The long-term issuer default ratings (IDRs) of STFC and MFL have been downgraded to BB from BB+.

"The rating actions reflect increasing macro-economic challenges for the Indian non-bank financial institution (NBFI) sector. These include the growing effects from measures to contain the COVID-19 pandemic, which will compound the tightening in funding conditions for NBFIs in recent weeks," Fitch Ratings.


Shares of STFC closed 16.74 per cent lower at Rs 603.20.

Muthoot Finance closed 1.01 per cent lower at Rs 612.

The ratings have been placed on rating watch negative (RWN), Fitch Ratings said in a release on Saturday.