Uptick In Promoter Stake Over Last Two Years? These Five Companies Saw Notable Surge
While promoters have been bullish, FIIs seem to have taken a more cautious stance over the last eight quarters.
In the dynamic landscape of the Indian stock market, the actions of a company's promoters often serve as a significant indicator of its future. The recent data shared by prime database for the BSE 500 paints a fascinating picture, revealing a stark contrast in promoter behavior over the past two years or eight quarters.
While a select group of 24 companies has seen their promoters consistently increase their stake, a larger cohort of 149 companies has witnessed promoters reducing their holdings. This divergence prompts a deeper look into what these movements signify for investors.
Last 8 Quarters In Focus
The last eight quarters have been a period of varied strategic shifts by promoters within the BSE 500. On one hand, a smaller group of 24 companies saw their promoters steadily buying into their own businesses. Conversely, a significantly larger number of 149 companies in the BSE 500 have seen their promoters offload a portion of their holdings.
The BSE 500 has surged by a remarkable 58% since March 2023, showcasing a significant bull run in the Indian equity market. This impressive growth highlights the strong investor confidence and overall positive sentiment prevailing over the past two years.
What FIIs & DIIs Are Doing
As equity markets evolve, insider activity remains one of the most telling indicators of long-term conviction. In the last one year, several Indian promoters have upped their stake in their companies—some significantly. But on the other hand, there is the divergence in approach from foreign institutional investors and domestic institutional investors side.
While promoters have been bullish, FIIs seem to have taken a more cautious stance. In Route Mobile, FIIs reduced their holdings by a sharp 15.9%, while DIIs remained flat. GMR Airports also saw a steep FII cut (-13.3%) even as DIIs upped their exposure by 6.0%.
In contrast, Poly Medicure witnessed FII selling (-4.8%) but strong DII buying (+8.3%)—hinting at rising domestic institutional confidence. On the other hand, Bombay Burmah saw both FIIs (+1.7%) and DIIs (+0.3%) marginally increase their stake.
Companies With Highest Promoter Stake Increase In Last 1 Year
What Have Stocks Done Vs BSE 500 Since March 2023
Despite the underlying shifts in shareholding patterns, stock price performance has been far from uniform. IFCI has delivered a whopping 326% return since March 2023—making it the top gainer among the list.
Poly Medicure and Bombay Burmah Trading Corp have also outperformed handsomely, returning 139% and 113% respectively. GMR Airports returned a solid 74%, while Route Mobile, despite strong promoter confidence, declined 31%.
Key Financial Metric Growth Over Years
Looking at the financials, Poly Medicure emerges as a standout performer, with its profit after tax rising at 32% compound annual growth rate and revenue growing at 22% CAGR. Route Mobile also remains strong on fundamentals with a 32% three-year revenue CAGR and 25% PAT CAGR, though revenue growth in FY25 remained moderate at 14%.
Bombay Burmah, saw a relatively muted revenue growth of 7% in FY25 but its net profit grew at an impressive 40% CAGR over a three-year period. GMR Airports reported a robust 19% growth in FY25 revenue growth, backed by a 31% three-year CAGR.
Valuations Have Remained In Line
Valuations have remained mostly stable. Poly Medicure, despite its sharp rally, is trading at 65x P/E, in line with its two-year average of 63 times. Route Mobile’s multiple has actually compressed from 23x to 19x, possibly reflecting recent underperformance.
Bombay Burmah trades attractively at 12x P/E, slightly below its two-year average of 14x. IFCI, being a financial entity, is evaluated on a price-to-book (P/B) basis and has remained consistent at 2.6x, marginally below its two-year average of 2.7x.
