Shares of Paisalo Digital Ltd fell sharply in Tuesday's trade. The stock crashed 20 per cent to hit its lower price band of Rs 139.75. At this price, it has slipped 29.86 per cent from its one-year high value of Rs 199.25, a level seen earlier this month on March 1. Despite the mentioned fall, the multibagger scrip has gained 232.66 per cent compared to its 52-week low price of Rs 42.01, hit on July 11 last year.
Bourses BSE and NSE have put the securities of Paisalo under the long-term ASM (Additional Surveillance Measure) framework. Exchanges put stocks in short-term or long-term ASM frameworks to caution investors about high volatility in share prices. The stock will trade ex-bonus on March 20 in a 1:1 ratio.
Today, the Delhi High Court has sought responses from Reserve Bank of India (RBI) and market regulator Sebi on a petition probing alleged unfair lending by Paisalo. The court action follows accusations that the shadow lender was charging a 125 per cent interest rate per annum on loans.
In the plea alleging exorbitant interest rates, the petitioner said an outstanding loan of Rs 15.9 crore in May 2019 escalated to Rs 23 crore in June 2019.
Sebi, in its argument, said it "doesn't regulate NBFCs' lending practices, emphasising role as a market regulator, especially in the securities market." Paisalo has been given time till 4 weeks to frame a reply.
Paisalo, in its clarification, said there's no order directing any regulator to investigate any unfair lending practices by the Delhi HC. "A defaulter named M/s Sat Priya Mehamia Memorial Educational Trust, Rohtak borrowed an amount of Rs 12 crore on March 24, 2018. The defaulter has only made a payment of Rs 25 lakh. 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 per cent. We have initiated various legal actions against the borrower and its office bearers including registering FIR. The defaulter violates the Delhi HC order dated January 23, 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. The high court has only ordered to Issue notice and reply to be submitted in four weeks," it stated.
On technical charts, the counter looked weak. "Paisalo Digital is bearish on daily charts with strong resistance at Rs 177. A daily close below support of Rs 135 could lead to a downward target of Rs 117 in the near term," said AR Ramachandran from Tips2trades.
"Support will be at Rs 138 and resistance at Rs 148. A decisive close above Rs 148 level may trigger a further upside till Rs 160. Expected trading range will be between Rs 125 and Rs 165 for a month," said Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers.
As of December 2023, promoters held a 48.86 per cent stake in the company.