North India Statesman
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Mumbai: Whether retail investors benefited from higher valuations of Indian equities in the September quarter is a matter of analysis but from the available data it can be said that promoters of companies benefited from higher prices of their shares.
Looking at the available data of around 3300 companies for the September quarter, it appears that promoters of around 595 companies have reduced stake in their companies as compared to the June quarter.
Promoters of 209 companies increased their stake in the September quarter, while promoters' stake in 2500 companies remained unchanged.
There are several reasons behind the reduction in equity holdings by promoters. Promoters sell or change hands for reasons ranging from personal financial management to strategic business moves. Furthermore, these sales are seen to reduce the debt burden of the company or to raise capital to set up new ventures.
An analyst said that the valuations in the market have been at a high level for some time, hence it has become easier for the promoters to sell their stake in the Indian market. On one hand, foreign institutional investors are selling the goods, while on the other hand, domestic institutional investors are also investors. Are making purchases, which is making it easier for the promoters to sell their stake.
The analyst also said the sale should not be taken as panic by the promoters without knowing the reasons for selling their stake.
