The Hindu Business Line : Promoters, pvt investors in selling mode as stock prices rise

WITH stock prices of several companies at all-time high levels, some promoters and big investors, especially private equity investors, are cashing in by selling their stakes.

This trend has increased in the last three months.

Disclosures made by investors and companies show that sale of shares of several companies is more than 10 per cent and the buyers in most cases are mutual funds and foreign institutional investors (FIIs).

The interesting part in most of the deals is that the stock prices of these companies have risen sharply after these deals have taken place.

Market analysts point out that sale by long-term investors like private equity investors shows that they have got the best value from their investment and now they are cashing in, while others see it as the peak of the stock prices. "When insiders start selling their large stake in the market, it is a cause of concern," said a top official of a leading broking firm. Some of the companies where big stakes sale have happened include Apollo Hospitals, where TWL Holding, a private equity investor, sold its entire 13.22 per cent stake to Bisikan Bayu Investments (Mauritius).

This transaction was through an off-market deal.

Similarly, TWL Holdings has sold its entire 24 per cent stake in Indraprastha Medical Corporation, a company promoted by Apollo Hospitals along with the Delhi Government. Part of this stake of around 10 per cent was bought by HDFC.

In the recently listed Shringar Cinema, India Value Fund of GW Capital has sold 18.65 per cent stake after listing.

Temasek Holdings bought 14.90 per cent from India Value Fund.

Private equity investor Chrys Capital through its Winterfall Fund sold its more than 6 per cent stake in MphasiS BFL Software in the open market.

Market sources said Fidelity bought these shares from the open market.

In Jain Irrigation, private equity investor Aqua sold 13.79 per cent stake to various FIIs.

Among the big deals where promoters or their associates have sold the stake include Ambika Cotton, Eastern Silk and S. Kumar's Nationwide.

In Ambika Cotton, promoters sold 34.75 per cent stake in a single day to mutual funds and FIIs.

The buyers include Reliance Mutual Fund (10.21 per cent). The other buyer is HSBC group.

In Eastern Silk, promoters sold 13.98 per cent of the equity to several high net worth individuals.

Aqua sells more stake in Jain Irrigation

PRIVATE equity fund Aqua India Ltd on Friday sold 1.5 crore shares of Jain Irrigation Systems Ltd (JISL) in a few block deals at Rs 158.25 per share amounting to 25 per cent stake for a total of Rs 235 crore.

The shares were bought by Standard Chartered Mutual Fund, Reliance Mutual Fund, Goldman Sachs, GMO, Lionhart Investment Ltd and HSBC Mutual Fund.

The transaction took place on the Bombay Stock Exchange. Shares of JISL ended at Rs 164.35, down from the previous close of Rs 166.30.

With this deal, Aqua has almost sold its entire holding of 40 per cent.

Last month, Aqua India had sold 80 lakh shares of JISL, amounting to 13.79 per cent stake, for a total of Rs 124 crore.

The irrigation company had made a preferential allotment to Aqua two years ago.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
CAs may be roped in for excise audits — Finance Ministry in talks with ICAI

Cheaper food, chemicals peg inflation down

MFs find little interest in debt schemes, turn to public provident fund

Decision on petro products price hike likely next week

Govt to sell 8 pc stake in Maruti to public sector FIs

Promoters, pvt investors in selling mode as stock prices rise

Access deficit charge review: DoT asks TRAI to consult Govt

SEs told to keep separate window for block deals

5 ICICI Bank staff suspended for exceeding trading limits