As per a leading business dailies report, promoters of nearly 50 listed companies that include JK Tyre and Industries, Infibeam Avenues and SH Kelkar among others have lowered share pledges during the quarter ended September. Share pledging is an option available to promoters of companies who use it for securing funds for meeting varied financial needs such as addressing working capital requirement, fund acquisitions or other businesses or for a personal requirement. Thus, the shareholding of a promoter in a company serves as collateral for availing the loan.
In the coming months, shares of these companies could surge in the range of 10-40% said the daily, referring Bloomberg consensus estimates.
Further, in accordance with the report, JK Tyre and Industries' promoters redeemed 35% stake, promoters of Apollo Hospitals lowered its share pledging to 66% from 71%, while Infibeam Avenues decreased pledged share from 21% in the previous quarter to 7.9%.
Other companies which have seen a reduction in share pledging by promoters include Omaxe, Swan Energy, Adani Transmission, Birlasoft, Igarashi Motors, Bharat Road Network, Centrum Capital, Indo Rama Synthetics and Emami Paper Mills.
Recently, shares were sold in the open market after promoters were not able to top up their pledges with additional shares as prices of the stock declined, the report said. In some cases, lenders have forced promoters to sell assets to repay loans, added the report.