Promoters offload record $14 billion shares in 2023
₹1.15 trillion ($14 billion), a staggering 161% rise from the ₹44,013 crore in 2022, and way higher than any other year in the past 10. The sectors that saw the most significant promoter selling included financial services, power, automobiles, metals & mining, and technology.
Leading the way was the Adani group, which diluted 32.3% stake in five group companies for ₹39,326 crore. Next in line was Barings PE, former promoter of Coforge, which sold 39.9% in the tech company for ₹11,000 crore.
IndiGo co-promoter Rakesh Gangwal's wife Shobha Gangwal divested her entire 7% stake in InterGlobe Aviation Ltd for ₹5,746 crore. (See chart for the top 10 list.) The sales have helped reduce promoter debt levels, helped them reinvest in new business areas, and gave PE firms exits at attractive levels.
The latter, in particular, took the rise in promoter sales to a new high last year, experts said. "In the last seven years alone, there has been a total of $350 billion investment from the gamut of alternate investment funds, which includes PE, VCF, Angel funds, etc, into equity, credit and real estate," said Nilesh Shah, MD, Kotak Mahindra AMC.
"Given the normal tenure of 7-10 years for a fund you will see these sales, where PE is promoter, increase." Lakshmi Iyer, CEO-Investment & Strategy, Kotak Alternate Asset Managers, said while Sebi’s restriction of 75% promoter holding in listed firms did contribute to some of the stake paring, the rich valuations of listed companies, which indicate that stock prices are high relative to their earnings or asset values, also played their part. “This favourable valuation environment may be encouraging promoters to sell shares at high prices, thus capitalising on the premium valuation," she said,
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