Edelweiss Financial Services jumped 8.19% to Rs 107.65 at 14:25 IST on the BSE due to bargain hunting after a recent slide.
Shares of Edelweiss fell 30.90% in the past six trading sessions to settle at Rs 99.50 on Friday, 23 August 2019, from its close of Rs 144 on 14 August 2019.
On the BSE, 4.81 lakh shares were traded in the counter so far compared with average daily volumes of 1.81 lakh shares in the past two weeks. The stock hit a high of Rs 106.5 and a low of Rs 99 so far during the day.
The stock hit a 52-week high of Rs 292 on 23 Aug 2018. The stock hit a 52-week low of Rs 93 on 23 Aug 2019. The stock underperformed the market over the past one month, falling 33.82% compared with 3.37% fall in the Sensex. The scrip also underperformed the market in past one year, sliding 64.55% as against Sensex's 4.27% fall.
On Friday, media reports indicated that the Enforcement Directorate (ED) is examining an investment of Rs 450 crore made by Edelweiss Asset Reconstruction Company (ARC) in Kohinoor CTNL Infrastructure. This is part of the ED probe into alleged irregularities in awarding loans and investment made in the real estate firm by beleaguered Infrastructure Leasing & Financial Services (IL&FS), reports added.
Following this report, Edelweiss Financial Services issued a clarification to the bourses that public sector banks had extended loans to Kohinoor Square project in 2010 which subsequently turned non-performing asset (NPA). From 2015 onwards, Edelweiss ARC participated in public auctions and bought the loans. Edelweiss ARC exposure is about 120 crore invested under the 15:85 structure.
Edelweiss ARC took the company through IBC process. A plan was approved by NCLT that would deliver unit owners their houses and small offices along with payment to lenders. The project is moving at fast pace and is nearing completion with small shop owners having already been offered possession. The resolution of the asset is also on track to provide all lenders with maximum possible recovery.
Enforcement Directorate has asked for some information and understanding of the process and the same has been briefed to them. The current probe by IL&FS on Kohinoor transactions are for the period of 2005-12 and related to transactions entered into by IL&FS and certain parties. Edelweiss group had no exposure to Kohinoor during that period, the company added.
On a consolidated basis, Edelweiss' net profit fell 50.1% to Rs 132.02 crore on a 2.6% rise in the total income to Rs 2545.93 crore in Q1 June 2019 over Q1 June 2018.
The Edelweiss Group is one of India's leading diversified financial services conglomerates providing a broad range of financial products and services to a substantial and diversified client base that includes corporations, institutions and individuals.
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