SKS Microfinance nosedived by nearly 20 per cent to hit the lower circuit limit on BSE today amid reports that global financial services firm JP Morgan has cut its share price target by more than half.
In a sharp reaction, the scrip of the country's largest microfinance institution ended 19.83 per cent lower at Rs 331.30 on the Bombay Stock Exchange (BSE).
In the intra-day trade, the scrip had declined by 19.98 per cent to hit the lower circuit limit of Rs 330.65.
Jittery investors went for panic selling on the National Stock Exchange as well, where the stock tanked 19.99 per cent to close at Rs 330.75.
"Downgrade by the banking major and an overall weak broader market trend has battered the investors' sentiment which resulted in such a big fall in the company's share," Religare Securities Executive VP Retail Research Rajesh Jain said.
In terms of volume, over 33 lakh shares of the company were traded on the bourses during the day.
According to media reports, J P Morgan slashed the company's share price target to Rs 200 from Rs 550, citing weakening of its business model.
SKS, the country's only listed microfinance institution, is expected to announce its results for the fourth quarter and year ended March 31, 2011 today.
Meanwhile, the BSE key index Sensex ended the day with a gain of 308.23 points at 18,518.81.
Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.
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