AAVAS Financiers gains 6% in two days after stake sale by AU Small Fin Bank

Despite the gains over the past 2 sessions, the stock of AAVAS Financiers has underperformed the market by gaining 7 per cent in the past 3 months relative to a 14.4-per cent rally in the S&P Sensex

Shares of AAVAS Financiers were up 3 per cent at Rs 1,577 on the BSE in the intra-day trade on Tuesday, gaining 6 per cent in the past two trading days, after AU Small Finance Bank sold nearly its entire stake in the housing finance company via open market.

On Monday, November 23, AU Small Finance Bank sold 3.5 million shares, representing 4.5 of total equity of AAVAS Financiers, according to BSE bulk deals' data. The value of these shares, at Rs 1,515.2 a piece was Rs 530.3 crore. AU SFB held 3.58 million equity shares or 4.57 per cent stake in AAVAS Financiers as on September 30, 2020, the shareholding pattern data shows.

Part of this, worth Rs 236.4 crore, was bought by Nomura India Investment Fund and SBI Life Insurance Company for Rs 100 crore. Nomura India Investment Fund – Mother Fund purchased 900,000 shares while SBI Life Insurance Company acquired 660,000 shares. The names of the other buyers could not be ascertained immediately.

Despite the gains over the past two sessions, the stock of AAVAS Financiers has underperformed the market by gaining 7 per cent in the past three months as compared to a 14.4-per cent rally in the S&P BSE Sensex.

For the first half of FY21, the company reported a 33 per cent year-on-year (YoY) decline in disbursements at Rs 879.6 crore compared to Rs 1,315 crore in H1FY20. Profit after tax during the period, on the other hand, was down 4 per cent YoY to Rs 116.60 crore from Rs 121.40 crore in the corresponding quarter of previous fiscal.