DHFL shares plunge 32%, hit 10-year low after a loss of Rs 2,224 cr in Q4

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Dewan Housing Finance Corporation (DHFL) shares crashed nearly 32 percent to hit a 10-year low of Rs 46.70 intraday on July 15 after posting a loss for first time since inception and warning about its survival.

The stock was trading at Rs 47.50, down Rs 20.95, or 30.61 percent on the BSE at 1131 hours IST. It lost nearly 93 percent of its value in the last one year.

The housing finance company posted a loss of Rs 2,224 crore for the quarter ended March 2019, against a profit of Rs 314 crore in the December quarter and Rs 134 crore in the June quarter of last year.

"In the backdrop of a significant slowdown in disbursement and loan growth after September 2018, the financials of the company have been quite strained for the quarter impacting the overall performance of the year," Kapil Wadhawan, Chairman and Managing Director said in a BSE filing.

Due to the additional provisioning of Rs 3,280 crore (including net loss on fair value), the company reported a net loss of Rs 2,223 crore for the quarter and a net loss of Rs 1,036 crore for the whole year (as against a profit of Rs 1,240 crore in previous year), he added.

The company also warned that its financial situation was so grim that it may not survive.

The company on July 13 said it was "undergoing substantial financial stress" and its ability to raise funds was "substantially impaired and the business has been brought to a standstill with minimal/virtually no disbursements."

"These developments may raise a significant doubt on the ability of the company to continue as a going concern," it said in notes accompanying results for the fourth quarter ending March 31, signed by Chairman and Managing Director Kapil Wadhawan.

Asset quality also worsened during the quarter as gross non-performing assets (NPA) increased significantly to 2.74 percent, as against 1.12 percent in previous quarter and 0.96 percent in March quarter 2018.

The housing finance company said it is in an advanced stage of submitting its resolution process under the inter-creditor agreement as entered into by banks. "As already announced, the inter-creditor agreement will examine and firm up the terms of the resolution process by July 25, 2019 and make it operational before September 25, 2019."