Shares of Shriram Finance Ltd fell sharply on Monday, trading down 5.03 per cent at ₹821.50 around midday, with the stock touching an intraday low of ₹810.20. The sell-off follows the company’s second-quarter results announced last Friday, which showed strong profit growth, but raised concerns over asset quality and credit costs.
Over 76.73 lakh shares changed hands by late morning, with sell orders slightly outpacing buy orders at 51.3 per cent versus 48.7 per cent. The stock is now nearly 29 per cent off its 52-week high of ₹1,153.70 hit in August.
Four major brokerages maintained buy ratings but cut their target prices, citing a deteriorating asset quality outlook. JPMorgan trimmed its target to ₹1,095 from ₹1,215, flagging that provisions surged 28 per cent quarter-on-quarter, pushing credit costs to 235 basis points, up 44 bps sequentially.
The brokerage noted management guided elevated credit costs for at least another one to two quarters, meaning the company will likely miss its 2 per cent credit cost guidance for FY27. Citi reduced its target to ₹1,100 from ₹1,200, while HSBC cut to ₹1,000 from ₹1,140. Motilal Oswal retained a target of ₹1,155.
The company attributed the stress to agri-sector strain from deficient rains in select geographies and typical second-quarter seasonality, calling the deterioration limited and not broad-based. Management also trimmed its FY27 AUM growth guidance to 15–17 per cent from 18 per cent, citing weak monsoons and uncertainty from the West Asia conflict.
On the positives, net interest income grew 38.2 per cent year-on-year to ₹8,661 crore, net interest margins expanded to 9.52 per cent from 9.04 per cent the previous quarter, and profit after tax rose 59.4 per cent to ₹3,677 crore. AUM grew 17 per cent year-on-year to ₹3.29 trillion.
Published on October 26, 2026
