Making best out of falling market!

Warren Buffet had said that the best way to make money on the stock market is to buy when the stocks are falling and sell when they are on the rise. While many might have taken this advice seriously, it looks like some of the Indian promoters have taken this falling market as the best opportunity to shore up their own stake in the companies. With stocks touching new lows, promoters seemed to have mopped up shares from the secondary market.

Swiss cement giant Holcim bought an additional 4.6% stake in ACC through Ambuja Cements recently. With this, the foreign promoter’s stake has gone up to 46%. Biyanis, have raised their stake by 2.6% to 46.5% in Pantaloon Retail, through the preferential allotment route. Parry Agro Inds picked up an additional 4.5% equity of Tube Investments of India to raise the total promoter holding beyond 51% in the latter.

Mehul Choksi, the promoter of Gitanjali Gems has increased his stake to 38.72% , Ravi Seth of GE Shipping has increased his holding in the company from 9.09% to 9.38%. In Hindustan Construction Company, wholly owned subsidiaries have helped shore the stake – Hincon Holdings stake has gone up from 39.07% to 39.16% and that of Hincon Finance from 7.39% to 7.49%. The promoter, Ajit Gulabchand has also raised his holding from 0.39% to 0.41%.

What has also come forth is that promoters, with low holdings, prefer the creeping acquisition route to buy back which proves to be quite cumbersome and tedious। And those with high stake? Well, they don’t need to shore up their holding in the first place, but if they need to quell any rumours about some liquidity crunch, then buy back is great. DLF being the best example of that!
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