Why did Manappuram Finance shares crash 10% today?

Synopsis: The shares of Manappuram Finance are down by 10% following reports that the Reserve Bank of India (RBI) has raised objections to Bain Capital’s plan to acquire a controlling stake in Manappuram Finance.

The shares of the Small-Cap stock, which specialises primarily in gold loans, being a pioneer NBFC in this space, but has diversified to offer a broad range of financial services, have been in the spotlight following a 10 percent decline in the stock. In this article, let’s explore the reason for the fall.

With a market capitalisation of Rs. 24,208.03 crores on Friday, the shares of Manappuram Finance Ltd declined upto 9.9 percent, reaching a low of Rs. 278.45 per share compared to its previous closing price of Rs. 309.35 per share.

What happened

Manappuram Finance Ltd, engaged primarily in gold loans, being a pioneer NBFC in this space, has diversified to offer a broad range of financial services, has been in the spotlight as it has declined upto 10 percent in the intraday trade.

Reason for the fall

Reuters, citing sources, reported that the Reserve Bank of India (RBI) has raised objections to Bain Capital’s plan to acquire a controlling stake in Manappuram Finance. To address the regulator’s concerns, Bain is now exploring a phased divestment of its stake in Tyger Capital. 

These developments could impact the proposed deal structure, under which Bain was expected to be classified as a joint promoter alongside existing promoters VP Nandakumar and Sushama Nandakumar after the transaction and the mandatory open offer.

In March, Manappuram Finance had announced a Rs. 4,385 crore investment from Bain Capital Asia, through which Bain would acquire an 18 percent stake. This included the purchase of 9.29 crore equity shares at Rs. 236 per share via BC Asia Investments XXV Limited, along with the issuance of an equal number of warrants at the same price to BC Asia Investments XIV Limited. 

Financials & Others

The company’s revenue declined by 13.28 percent from Rs. 2,633 crore in September 2024 to Rs. 2,283 crore in September 2025. Meanwhile, the Net profit declined from  Rs. 572 crore to  Rs. 217 crore during the same period.

The company demonstrates decent capital efficiency, with a Return on Capital Employed (ROCE) of 11.0% and a Return on Equity (ROE) of 10.1%, indicating steady returns generated from both overall capital and shareholders’ funds. Additionally, it has maintained a healthy dividend payout ratio of 19.2%, reflecting a balanced approach between rewarding shareholders and retaining earnings for future growth.

In Q2 FY2026, the company reported steady performance with consolidated AUM reaching Rs.  45,789 crore, reflecting a 3.4 percent quarter-on-quarter growth. Operational efficiency also improved, as the OPEX to NIM ratio declined to 52.5 percent, marking a 1.4 percent QoQ reduction, underscoring better cost management and margin optimisation.

The AUM mix for Q2 FY2026 is predominantly composed of Gold, which accounts for 69% of the total. Other components include MFI at 11%, HFC at 4%, VEF at 9%, Onlending at 1%, and MSME making up 7%. This distribution highlights a strong emphasis on Gold within the portfolio for this quarter.

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