The Life Insurance Corporation of India (LIC) is the biggest domestic institutional investor (DII) in India and investors closely track the changes that it makes to its portfolio. Recently, LIC reduced its stake in a stock which forms a part of ace investor Radhakishan Damani’s portfolio. In fact, it has gradually been reducing its stake in the company.
In a regulatory filing, LIC said that it has diluted its shareholding in India Cement from 1,82,05,665 shares to 1,18,77,759 equity shares, decreasing its shareholding from 5.875 percent to 3.833 percent of the paid-up share capital of the company. This decrease in holding happened during the period from November 21, 2007, to July 04, 2023, and at an average price of ₹ 191.59.
The Insurance behemoth recently reduced its stake in the company from 1,36,91,063 shares or 4.42 percent to 1,18,77,759 shares or 3.833 percent.
As a result, India Cements share price shed 2.4 percent to reach an intraday low of ₹ 207.10 apiece on the National Stock Exchange (NSE). At 01:16 PM, its shares were trading at ₹ 212.25 apiece.
Ace Investor Radhakishan Damani with his brother Gopikishan Damani holds 41,49,029 shares or a 1.34 percent stake in the company. In addition to that, he holds another 3,51,32,665 shares or an 11.34 percent stake in the company.
India Cements Ltd is a leading cement manufacturing company in India. It has ventured into related fields like shipping, captive power and coal mining that have purposeful synergy to the core business. It is also a sponsor of the IPL franchise “Chennai Super Kings”.
With a market capitalization of ₹ 6,578 crores, India Cements is a small-cap company. It has a negative return on equity of 2.16 percent but an ideal debt-to-equity ratio of 0.51. Its shares were trading at a price-to-earnings ratio (P/E) of 67.26, which is significantly higher than the industry P/E of 31.11, indicating that the stock might be overvalued as compared to its peers.
Retail investors hold a 49.06 percent stake in the company, followed by its promoters with 28.42 percent, foreign institutions with 13.14 percent, mutual funds with 4.96 percent and other domestic institutions with 4.42 percent.
Written By Simran Bafna
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