1:1 Bonus Issue: Trading Below Rs 115, NBFC Stock Falls By 41% In 3-Consecutive Sessions; Here's Why!

NBFC company, Paisalo Digital has witnessed sharp selling for three consecutive trading sessions, falling by nearly 41% so far in the current week. Even its upcoming 1:1 bonus shares record date could not stir bullish demand in Paisalo. The bearish trend appeared in Paisalo after news reported that the company is involved in unfair lending practices. However, Paisalo has denied the allegations.

Paisalo Digital Share Price:

NBFC's stock price ended at Rs 112 apiece, down by 19.86% on BSE after market hours of Wednesday. The company's market cap stood at Rs 5,029.05 crore.

Paisalo has been in red throughout the current week so far. On March 12, the stock nosedived by 20%, followed by a nearly 7.8% drop on March 11.

Last week, on March 7, Paisalo's stock price stood at Rs 189.35 apiece.

So far this week, the drop in Paisalo is about 40.85% on BSE.

Paisalo Digital Unfair Lending Allegations And Clarifications:

On March 12, The Economic Times reported that the Delhi High Court has sought a response from the Reserve Bank of India Securities and Exchange Board of India and others on a plea seeking independent inquiry into the alleged "unethical and unlawful lending practices" carried by Paisalo Digital.

However, Paisalo denies the allegations. In its regulatory filing on March 12, Paisalo clarified saying, "Paisalo confirms that there is no order directing any regulator to investigate any unfair lending practices by the Hon'ble High Court At New Delhi."

Further, Paisalo highlighted a defaulter named Sat Priya Mehamia Memorial Educational Trust, Rohtak who borrowed an amount of Rs 12 crore on March 24, 2018. Paisalo said that this defaulter has only made a payment of Rs 25 lakh. It added, "The defaulter and its office bearers are involved in selling off the land mortgaged to us. The company has treated this as a loss asset in September 2019 in its books of accounts by providing 100%."

Thereby, Paisalo added, "We have initiated various legal actions against the borrower and its office bearers including registering FIR. The defaulter violates The Hon'ble High Court of Delhi order dated 25.01.2024 to maintain the status -quo as to title and possession in respect of the mortgaged properties. But despite such court orders, the defaulting entity has continued its process of illegally disposing of the mortgaged properties."

Hence, Paisalo added, "The Hon'ble Delhi High Court has only ordered to "Issue notice and reply to be submitted in four weeks". The company reaffirmed that there is no order directing any regulator to investigate any unfair lending practices by Delhi HC.

Paisalo Digital Bonus Issue:

Paisalo announced a bonus issue in the ratio of 1:1. This means that the company will issue one new bonus Equity Share of Re. 1 each for every existing Equity Share of Re. 1 each held by the shareholders of the Company as of the Record Date.

The company fixed Wednesday, March 20, 2024, as the 'Record Date' for ascertaining the eligibility of shareholders entitled to issuance of Bonus Equity Shares of the Company.

Further, on March 13, Paisalo updated that they have proposed allotment of 44,90,21,990 Equity shares of Re.1/- each as bonus share in the ratio of 1 new equity share for every 1 existing equity share held in the Company.

A meeting is scheduled on March 21, to consider and approve the allotment of Bonus Equity Shares in the ratio of 1:1.

Paisalo Digital Limited leverages Artificial Intelligence and Machine Learning to offer intelligent and hassle-free loans through a high-tech: Touch approach. With a robust distribution network in rural and semi-urban areas of India, Paisalo has serviced over 15 lakh borrowers and has 1052 touchpoints across the country. The company is at the forefront of co-lending and are pioneer in seamless credit distribution services to the bottom of the pyramid by administration of small-ticket loans, as per its LinkedIn profile.