Gold loan companies extends fall, Manappuram Finance at 44-month low

Shares of companies engaged in gold loan business like Muthoot Finance and Manappuram Finance have extended their yesterday’s fall and trading lower by up to 10% after the sharp slide in gold prices.

Manappuram Finance is locked in maximum lower circuit of 10% for a second consecutive day at Rs 15.70 on BSE. The stock is currently trading at its lowest level since August 2009.

A combined 1.69 million shares have already changed hands and there are pending sell orders for a combined 1.29 million shares on BSE and NSE at 10.10 hours.

Muthoot Finance has tanked 8% to Rs 121, extending its Monday’s 13% fall on the BSE. The stock opened at Rs 124 and touched low of Rs 116 so far.

The price of gold bullion tumbled 9% in heavy trade yesterday, and shed more than $125 per ounce in its biggest-ever daily loss.

India's gold imports have fallen nearly 24% in the first quarter and probably dropped at the same pace in April, the head of a major trade body said on Monday, as importers sit on stocks bought before global prices slumped towards two-year lows.

Analyst at Nirmal Bang expects the prices of precious metals to remain under pressure as major sell-off across the commodities board is expected to further pressurize prices. (Business Standard)