24 October, 2020

6000 Ways To The Market

Promoters are selling their stakes at alarming speeds. A signal for the retail investor to watch his step.

Jayachandran
6000 Ways To The Market
outlookindia.com
-0001-11-30T00:00:00+05:53
Is there anything common between American promoters like Martha Stewart and Kenneth Lay, and their Indian counterparts like Jeetendra (Balaji Telefilms), Manmohan Shetty (Adlab Films) and K.N. Saraogi (Balrampur Chini)? Nothing really, except that all of them sold their personal stakes in their companies at huge profits. It seems, like in the US, Indian promoters are cashing in on the current bull run. Except for one minor—and crucial—difference: as of now, the moves in India have neither become controversial nor got the regulators breathing down the promoters’ necks. The Stewarts and the Lays, of course, knew that their companies were heading towards disaster, that their stock prices would crash soon and so they cashed out at the right time.

But the fact remains that Indian promoters have realised there’s a killing to be made on the exchange. So, whether it’s diluting their holdings, floating new issues to raise fresh capital, or seeking other opportunities to make personal gains, the owners are behaving like part investors. And why not? This is the time to make...

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