Nisus Finance Services Share Price Drops 10% After Q4 Results – Should You Buy, Sell, or Hold?

Nisus Finance Services Share Price Slumps 10% Post Q4 Results: Should You Buy, Sell, or Hold?

Mumbai, May 30, 2025 – Shares of Nisus Finance Services tumbled sharply by 10% in early trading on Friday following the release of the company’s Q4 financial results. The unexpected dip has triggered a wave of analysis and debate among investors and market watchers about the stock’s future trajectory. This article delves into the key reasons behind the stock's decline, expert analyst insights, the broader market context, and what investors should consider moving forward.

Q4 Performance: A Mixed Bag

Nisus Finance Services reported its Q4 FY25 earnings yesterday, showcasing a mixed performance that seemed to have disappointed investors. The company posted a 5% decline in net profit year-on-year, registering ₹82 crore against analysts’ expectations of around ₹90 crore. Revenue grew marginally by 2% to ₹1,250 crore, but the growth was below street estimates.

The results highlighted an uptick in non-performing assets (NPAs), which rose by 1.2 percentage points to 5.8%, putting pressure on the company’s credit portfolio. Additionally, operating expenses increased by 8%, impacting the overall margins.

Market Reaction: Why the Sharp Decline?

The immediate reaction to the Q4 results was a 10% plunge in Nisus Finance’s share price, wiping out nearly ₹1,500 crore of market capitalization. Investors appeared concerned about the company’s asset quality and margin pressures amid a challenging macroeconomic environment.

According to Mr. Prasad Bhave, “Nisus Finance’s Q4 results reveal underlying stress in their loan book, particularly in the retail and SME segments. While the company is taking steps to manage NPAs, the incremental provisioning and margin compression indicate short-term headwinds.”

Bhave adds, “The market had priced in steady growth and stable asset quality. The deviation from this narrative caused the selloff. However, this might present a tactical buying opportunity for long-term investors.”

Analyst Views: Diverse Perspectives

• Bearish Outlook: Some analysts warn of further downside risks if macroeconomic conditions worsen. Ms. Anjali Kapoor, Credit Market Strategist at Verity Capital, says, “The rise in NPAs is a red flag, especially given tightening interest rates and inflationary pressures. Unless Nisus Finance aggressively cleans up its portfolio and improves operational efficiency, the stock could face additional pressure.”

• Neutral to Cautiously Optimistic: Others advocate a wait-and-watch approach. Mr. Vikram Singh, Senior Fund Manager at BrightWave Capital, notes, “While the short-term numbers disappoint, Nisus Finance has a robust customer base and diversified loan portfolio. Their strategic focus on digital lending and cost optimization might help stabilize margins in the coming quarters.”

• Bullish View: A few remain bullish on the stock’s long-term potential. “Market corrections like these often present value. Nisus Finance has a strong capital adequacy ratio, and its management has a proven track record in risk management,” says Mr. Arjun Desai, Head of Research at PrimeInvest Advisors.

Broader Market Context

The slump in Nisus Finance shares comes amid a cautious mood in the financial services sector. Several mid-sized NBFCs (Non-Banking Financial Companies) have reported rising NPAs and subdued earnings in the last two quarters, driven by inflationary pressures, rising interest rates, and slowing economic growth.

Moreover, the Reserve Bank of India’s recent monetary tightening has increased borrowing costs, squeezing margins for lenders. This has led to increased scrutiny on asset quality and risk management across the sector.

Investor Outlook: Buy, Sell, or Hold?

For investors wondering whether to buy, sell, or hold Nisus Finance shares, the decision depends largely on risk appetite, investment horizon, and confidence in the company’s turnaround strategy.

• Buy: Investors with a long-term perspective and belief in Nisus Finance’s fundamentals may view the current price dip as an attractive entry point. The company’s strategic initiatives in digital transformation and expansion into new credit segments could fuel future growth once macro headwinds ease.

• Hold: Those already invested might prefer to hold and monitor upcoming quarterly results for signs of stabilization in NPAs and margin recovery. A disciplined approach with stop-loss limits could help mitigate downside risks.

• Sell: Risk-averse investors or those seeking short-term gains may consider booking profits or cutting losses, given the volatility and sector-wide uncertainties. A cautious stance is advisable until clearer signs of recovery emerge.

Conclusion

Nisus Finance Services’ Q4 results have introduced a note of caution for investors amid a challenging operating environment. The 10% share price slump reflects market concerns around asset quality and margin pressures. While some analysts see this as a temporary setback with potential for recovery, others highlight structural risks in the near term.

Ultimately, investors should carefully assess their own risk tolerance and investment goals, closely track the company’s upcoming performance, and consider the broader macroeconomic factors influencing the financial sector before making any trading decisions.