Shares of Spandana Sphoorty Financial Ltd. fell as much as 8 percent on Wednesday after nearly 36 lakh shares of the company worth Rs 276 crore exchanged hands in a block deal.

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The stock has recovered from the day's low since then.

A total of 5.5 percent equity of the company exchanged hands in the block deal, according to data available on the exchanges. Buyers and sellers in the transaction are not known.

Last month, CNBC-TV18 reported that dealers were expecting a large block deal to take place in the stock soon wherein the ex-promoter of the company is likely to sell the stake.

In June, Spandana Sphoorty, which specialises in rural loans, called reports of private equity major Kedaara Capital looking to sell off its stake in the microfinance lender to Yes Bank as "incorrect and speculative."

The clarification came after the Economic Times reported that Kedaara Capital revived plans to sell off Spandana and was in talks with Yes Bank to explore an M&A deal.

About 18 months ago, the private equity firm had shelved a similar plan after allegations by Spandana founder Padmaja Gangireddy that it was selling off the company to Axis Bank at a "throw-away price", the ET had reported quoting two people familiar with the development.

Kedaara Capital held a 7.06 percent stake in Spandana as of the March quarter, the shareholding pattern available with the BSE showed.

Shares of Spandana Sphoorty are trading 2.4 percent lower at Rs 802.65. The stock is up nearly 40 percent so far in 2023.