Promoter Stakes Slip for Third Straight Quarter Across NSE-Listed Firms

Promoter ownership in NSE-listed companies slipped to 50.1% in Q3FY25, the lowest level seen in the last seven quarters. This marks the third consecutive quarterly decline, as per NSE data.

In absolute terms, the value of promoter holdings dropped by 6.9% QoQ during the same period, to Rs 205 lakh crore. This brings the total decline in the second half of the fiscal year to 14.3%, following a sharp 21.8% rise witnessed in the first half. The subsequent fall in H2 signals that promoters might have booked profits amid high valuations.

"The absolute amount held by them fell by 6.9% QoQ to Rs 205 lakh crore, taking the total decline to 14.3% in the second half after a strong 21.8% increase in the first half. The decline was broad-based across promoter categories, primarily led by a drop in private Indian promoter share," NSE's recent 'Market Pulse' report stated.

Meanwhile, private Indian promoters' stake in NSE-listed companies fell for the second straight quarter, down by 16 basis points QoQ to 32.5%.

This decline was mainly driven by individual promoters, whose share dropped 44 basis points to 6.8%. These individuals hold about 21% of total private promoter stakes, as per NSE data

"Foreign promoters saw a 7.0% QoQ decline in value to Rs 33.2 lakh crore, with their ownership dipping 6 bps to 8.1% QoQ, though still up 12 bps in FY25," as per the report.

Volatility takes a halt

Domestic benchmark indices, Sensex and Nifty, are finally witnessing a drop in overall volatility as trade tensions ease. The volatility index, Nifty Vix, dropped over 10% this month, signalling a calm in overall investor sentiment.

While border tensions have eased, the US trade court has blocked Trump's 'reciprocal' tariff reforms. On the domestic front, a healthy drop in inflation levels has brightened the chances of a prospective rate cut by the RBI.

"...much of the event-driven volatility either behind us or largely priced in, investor focus should now shift 'From Events to Earnings'. Early Q4 results suggest improving corporate performance, and a 14% CAGR in Nifty EPS over the next two years is expected," Motilal Oswal Private Wealth said in its recent report.