SKS Microfinance scrip tanks 5% on BSE

SKS Microfinance scrip tanks 5% on BSE

Mumbai: SKS Microfinance on Friday tumbled over 5% in the afternoon trade at the Bombay Stock Exchange, after the Andhra Pradesh Police arrested three people working with it and another small lender Spandana, on a complaint of harassment by a borrower.

Shares of SKS Microfinance, the only listed microfinance entity in the country, took a sharp hit and plunged by 5.11% to touch a month’s low of Rs1,050 on the BSE in the noon trade.

The Andhra Pradesh Police also said that it might book the promoters -- Vikram Akula of SKS and Padmaja Reddy of Spandana -- under a new Ordinance that aims at checking coercive methods of loan recovery by small lenders.

SKS scrip had opened the session on a positive note, but went into a tailspin on the news of the arrest.

On the National Stock Exchange, the company was trading at Rs1,067, down 3.73%.

The case was filed by the borrower, Ammulu, last night under Section 16 of the AP Microfinance Institutions (Regulation of Money Lending) Ordinance-2010.

SKS Microfinance is holding its board meeting today.