Pledged Promoter Holdings Fell 2.83% In Fourth Quarter, Kotak Institutional Equities Says
Pledged promoter holdings declined by 2.83 percent in value in the three months through March compared with the previous quarter, according to a report by Kotak Institutional Equities.
The brokerage analysed the majority shareholder stakes of the latest BSE-500 constituents out of which, it said, the promoters of 116 companies have pledged their holdings. As many as six companies had pledged over 90 percent of their promoter holdings, the report said.
Promoters pledge their shares, among other options, to secure loans to meet working capital requirements, fund other ventures or make acquisitions. Promoter shareholding in a company is often used as collateral to avail loan. The pledging, however, doesn’t mean distressed financial state of a company or promoter.
The report included data showing changes in pledged holdings between the March and the corresponding previous quarter.
Key Highlights:
No company in the BSE 500 Index had promoters that revoked their entire pledged holdings, the report said.