The shares of Dewan Housing Finance Corporation Ltd (DHFL) were locked at the upper circuit on Thursday after the Reserve Bank of India (RBI) superseded its board and said it would refer the company to the National Company Law Tribunal (NCLT).

The DHFL scrip rose around five per cent to settle at Rs 21.15 on the BSE. More than 18 lakh shares were exchanged on Thursday, much higher than the two-week average of 3.58 lakh shares.

On Wednesday, the central bank said it had superseded the board of DHFL under Section 45-IE (I) of the RBI Act, 1934.

The RBI, which is now the regulator of housing finance companies, said it took this action owing to governance concerns and defaults by the non-bank lender in meeting various payment obligations.

R. Subramaniakumar, the former MD and CEO of Indian Overseas Bank, has been appointed administrator.

The gains in the DHFL stock came as the focus of attention shifted to the possible bidder for the troubled housing finance company.

While there were unconfirmed reports of the Adani group and Piramal Enterprises being in the race, State Bank of India chairman Rajnish Kumar told a television channel that DHFL could see several bidders once the insolvency process starts.

DHFL will be the first non-bank lender to come under the insolvency process.

The Government had recently notified rules under the insolvency law to deal with resolution of systemically important financial institutions excluding banks.

The rules say that the resolution plan should include a statement explaining how the bidder intends to satisfy the requirements of engaging in the business of the financial service provider, after approval of the resolution plan by the committee of creditors (CoC). It also said that the administrator shall seek ‘no objection’ of the appropriate regulator to the effect that it has no objection to the persons, who would be in control or management of the financial service provider after approval of the resolution plan.