Ujjivan Financial drops 10% after near doubling; what happened?

The dream run of Ujjivan Financial Services Ltd (UFCL) has come to a halt.

The share price on the BSE dropped nearly 10% in opening trade on Monday June 6, 2016.

At 9:59 AM, share of UFCL were trading down 9.87%, or Rs 37.80 per share, at Rs 344.50.

The shares of the company had listed on the bourses on May 10 at Rs 210 per share.

The stock price nearly doubled as it closed at Rs 399.50 per share on Friday and closed the day at Rs 382.95 per share.

Analysts said that the spectacular performance of the stock was due to its 134% rise in profit in 2015-16.

Hindustan Times reported on Friday, “Microfinance institutions like Ujjivan have higher yields, high return on capital, and lower NPAs. Till now, SKS was the only listed MFI. So, Ujjivan and Equitas have seen lot of interest,” said Siddharth Khemka, vice-president at Centrum Wealth Management.