Bajaj Finance, Axis Bank decline 5% after S&P downgrades ratings

S&P Global Ratings said that worsening operating conditions following Covid-19 have increased risks for financial institutions and banks operating in India

Shares of Bajaj Finance and Axis Bank slumped 5 per cent each on the National Stock Exchange (NSE) to Rs 2,770 and Rs 404, respectively, on Monday, after S&P Global Ratings downgraded its ratings on the two companies to BB+, which is junk or non-investment grade.

“In our base case, we believe Bajaj Finance’s asset quality and credit costs will deteriorate over the next 12 months. We lowered our ratings on Axis to reflect our expectation that heightened economic risks facing India's banking system will affect the bank's asset quality and financial performance,” S&P said.

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