Cholamandalam Share Price: Allegations made by Cobrapost and what analysts make of them

Shares of Cholamandalam Investment and Finance Company fell as much as 4% on Monday, December 22, marking their fifth day of declines in the last six trading sessions. The stock is down 9% during this six-day period. The stock has staged a rebound on Tuesday.

Cobrapost, a digital portal, has made allegations of corporate governance against Cholamandalam, the Murugappa Group of Companies, and its promoters.

Here are some of the allegations made by the Murugappa Group and the company:

A sum of ₹10,262 crore worth related party transactions have been carried out, including those with Murugappa Group Entities, which merits a closer regulatory scrutiny, according to the Cobra Post report.

The report goes on to add that the Murugappa Group reported cash deposits of ₹25,089 crore over the last five years, which according to Cobrapost, is "high, unusual, and indicative of asset quality risks for CIFC."

A red flag has also been raised on the sharp increase in auditors' fees, and related party disclosures made by the company and Chola MS Insurance indicate many allegations of non-disclosure and non-compliance as the company reported ₹942 crore as earned in commission by selling insurance between financial year 2024 and 2025.

Concerns have also been raised regarding payments to Murugappa family members, which Cobrapost terms "too high", as well as to credit rating agencies.

Analysts Respond

Analysts have responded to the allegations made in the Cobrapost report.

They go on to say that ₹25,000 crore worth of cash deposits constitute less than 12% of Cholamandalam Investment's collections and should be seen in positive light, as cash collections constitute nearly 20% to 40% of the total collection.

Analysts also add that payments made by Chola MS to various group entities is an industry practice and that they do not find the auditor's remuneration to be excessive.

On the insurance front, analysts said that many other NBFCs have also changed their practice with regards to insurance income from financial year 2025, and a 135% increase in standalone insurance fee income drops to 43% year-on-year on a consolidated basis.

Shares of Cholamandalam Investment and Finance are trading 4.3% higher in early trading at ₹1,649.6. The stock has risen 35% so far in 2025.