IndusInd Bank, Godrej, Apollo Tyres – some of the biggest gainers in June are stocks where promoters have raised stakes

IndusInd Bank, Godrej, Apollo Tyres – some of the biggest gainers in June are stocks where promoters have raised stakes
BSE building in MumbaiBCCL
  • Promoters of well-known Indian companies like IndusInd Bank, Godrej Industries and Apollo Tyres increased their stake in June.
  • While the Indian stock markets increased by just over 4% in June, six of these stocks delivered at least a 10% increase in the same period.
  • Analysts suggest that this indicates the promoters are committed to their companies – putting money where their mouth is, so to say.
Promoters of companies like IndusInd Bank, Godrej, Apollo Tyres and Adani Ports have raised stakes in their companies and these stocks have turned out to be some of the biggest gainers in June so far.

Indian stocks markets Sensex and Nifty have crashed by more than 18% this year, wiping off lakhs of crores of investor wealth. But this crash has also presented an opportunity for promoters to swoop in and increase their stakes at discounted prices.

Buying on dips is often used by investors as a strategy to invest in companies at a discount. While it might not always work, six companies have gained at least 10% in the ten days of trading in June. IndusInd Bank was the biggest gainer, with an increase of 34% this month so far.

In comparison, the Indian stock markets have only increased by a shade over 4% in the same period.

Here’s how these six stocks have performed in June so far

CompanyGains till June 12
IndusInd Bank34%
S H Kelkar & Company30%
Gulshan Polyols29%
Godrej Industries18%
Apollo Tyres10%

Source: BSE

Should you buy on dips too?

Buying on dips can be an effective investing strategy if the companies you’re investing in are fundamentally strong. However, at the end of the day, this is a market timing strategy more than anything else – and it might not always work.

“If the promoters are increasing their own stake in a tough business environment, it just shows that they are committed to their own business and see this fall as an aberration, and use it to increase their stake,” Arjun Yash Mahajan, head - institutional business, Reliance Securities, told Economic Times.


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