Nirav Modi scam: Fraud-hit PNB loses Rs 110 billion in mcap in 5 days

Punjab National Bank's market valuation has slumped by Rs 109 billion in five days, which is nearly equal to the massive Rs 113.84billion fraud at the company, even as the stock made a marginal recovery today.

The stock had dropped in the previous four trading sessions. In the past one week, the stock has lost nearly 28 per cent.

PNB's market valuation fell by Rs 109.38 billion to Rs 282.70 billion today from Rs 392.09 billion on February 12.

The company's scrip meanwhile staged a marginal recovery today ending 0.13 per cent higher at Rs 116.55 on BSE.

During the day, the stock lost nearly 5 per cent to hit a one year low of Rs 111.

As per the BSE shareholding pattern data, the government owns 57.04 per cent stake in PNB and with the fall in stock price, it has lost Rs 62.74 billion. Life Insurance Corporation of India which has 13.93 per cent stake has lost Rs 15.32 billion. Foreign portfolio investors (FPIs) with 12.56 per cent stake has seen an erosion of Rs 13.81 billion and small investors about Rs 38.7 billion.

On Wednesday last week, PNB said it detected a fraud in which diamond merchant Nirav Modi allegedly acquired fraudulent letters of undertaking (LoUs) from one its branches for overseas credit from other Indian lenders, and is being probed by CBI and Enforcement Directorate among other agencies.

International rating agencies Moodys Investor Service and Fitch Ratings today warned the scam-hit Punjab National Bank (PNB) of rating downgrades, citing likely networth erosion and widening losses at the second largest state-run lender.