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<\/p>\nStake sales by promoters and private equity\/venture capital (PE\/VC) investors this year are already exceeding twice those of last year.<\/p>\n
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So far this calendar year, the selling stands at over Rs 87,400 crore, 2.2 times the Rs 39,700 crore worth of shares sold by promoters and PE\/VCs in 2022.<\/p>\n
This year’s tally has received a boost from stake sales by Adani group promoters.<\/p>\n
“Our analysis of bulk\/block deal data shows that 2023 has seen the highest promoter selling in the past six years.<\/p>\n
“However, we would note that Adani group promoters sold a whopping Rs 37,000 crore, which is almost 40 per cent of overall promoter selling in 2023.<\/p>\n
“Automobiles and components, capital goods, electric utilities, IT services and transportation sectors have seen the bulk of promoter selling so far this year, while insurance and IT services accounted for a large portion of promoter selling over 2018-2023,” said a note by Kotak Institutional Equities titled ‘Who is Right?’<\/p>\n
“The selling by promoters largely reflects strategic compulsions (debt management), while that by the PE reflects tactical (price) considerations.<\/p>\n
“Domestic investors have absorbed the bulk of the sell-downs,” the note further said.<\/p>\n
The buoyancy in the secondary market has also encouraged these sell-downs.<\/p>\n
The Nifty Midcap 100 index has rallied 27 per cent, while the Nifty Smallcap 100 index has rallied 30 per cent.<\/p>\n
Both have outperformed the benchmark Nifty, which is up 7.4 per cent.<\/p>\n
PE investors who have offloaded large stakes this year include Bain Capital (sold stakes in L&T Finance and Axis Bank), Sequoia Capital (Go Fashions), TPG (Five-Star Business and Campus Activewear), and Baring PE Asia (Coforge).<\/p>\n