Fusion Finance shares slip 10%, top BSE losers; here's why 

Shares of Fusion Finance slipped to their lower circuit of 10% in early deals on Monday after brokerage Investec downgraded the stock's rating to 'sell' from 'hold'. It also reduced target price for the microfinance institution to Rs 300 apiece from the earlier Rs 500.

The negative outlook by the brokerage came after the company signaled a higher estimated credit loss (ECL) provisioning for the second quarter of FY25 as compared to Q1.

Fusion Finance stock was the top loser on BSE, falling 10% to Rs 274.70 against the previous close of Rs 305.20 on BSE. Market cap of the firm slipped to Rs 2829.7 crore.

On September 21, the company said that it would make an ECL provisioning of up to Rs 550 crore in Q2FY25 against Rs 348 crore provision in Q1FY25.

The estimated credit loss provisioning, the lender said, may undergo revisions upon finalisation of the Q2FY25 results, including pursuant to the limited review by the statutory auditors. Investec analysts said that the profit warning by Fusion Finance might lead to credit downgrade, funding challenges, or loan book decline.