Last week, the shares for Page industries were among the best performers on the local bouses in the last five years. Owing to this trend the promoters in the company, Sunder Genomal, Nari Genomal and Ramesh Genomal sold 2.81% of their stake in the company through various open market transactions. This has ultimately reduced the promoter holding in the company, bringing it down to 49% from the earlier 51.81%.
After the promoters cut their stake, the stock futures of Page industries-the licensee of Jockey slipped to their deepest discount to the share price since their entry into the derivative segment early this week. The analysts are predicting that the stocks will be going down by another 10% in the nearer future.
As per records, earlier to this when the promoters began to sell their stocks, US-based Smallcap World Fund acquired a stake worth Rs 188.49 crore in Page Industries. According to the bulk deal data available with NSE, Smallcap World Fund bought 1,62,500 shares or 1.45 per cent stake in the company. The shares were acquired at an average price of Rs 11,599.98 per scrip totalling the transaction to Rs 188.49 crore.
The March and April futures of Page Industries ended at a discount of Rs 329.55 and Rs 429.55, respectively to the closing price of Rs 11,109.55 on the NSE, down 2.3 per cent from the previous close. The stock has underperformed the Nifty Midcap 100 index so far this year, falling 16.9 per cent against a fall of 7.1 per cent in the index in the same period.
Besides worries about promoters paring their stakes in the company, high valuations are also likely to weigh on the stock in the near term. Between 2009 and 2014, Page shares ran up 17 times (1700 per cent).
