Regulatory Scrutiny on IIFL Capital

Markets regulator Sebi has issued a warning to IIFL Capital Services regarding due diligence lapses in debt issues managed by its merchant banking division. This action follows an inspection by Sebi, which reviewed debt issues handled by the company between April 1, 2022, and April 30, 2024.

Concerns Raised by Sebi

Sebi raised concerns about the disclosure of individual break-ups of issue-related expenses and the timelines for fee payments to intermediaries in offer documents. Following IIFL Capital’s response to these findings, Sebi issued the warning letter, citing observations on the due diligence process under the ICDR (Issue and Listing of Non-Convertible Securities) Regulations, 2021.

Impact on IIFL Capital

Despite the development, as of 2:53 pm, IIFL Capital Services stock were trading at ₹204.39, down 0.27%, after fluctuating between ₹198.00 and ₹208.99 during the session. While the regulatory scrutiny may weigh on sentiment, the company’s fundamentals-- P/E ratio of 8.62 and a dividend yield of 1.83%, suggest stability.