Pledging of shares refers to the practice of using shares as collateral to secure a loan, as it is sometimes considered a good option for promoters and investors to raise capital.
However, the case of the company’s promoters having a higher percentage of pledged shares may indicate a red flag, and financial troubles within the company, potentially leading to a decrease in stock prices, and goodwill as it is often viewed as risky by investors.
Here are some of the companies where the Promoters have increased the pledge over their holding.
Max Financial Services
Max Financial Services Limited operates as a holding company for Max Life Insurance Company Limited. It is engaged in the business of investments, providing management advisory services and life insurance solutions.
With a market capitalization of Rs. 34,967 Crores, the shares of Max Financial Services Limited were trading at Rs. 1,013.20, down 0.89 percent from its previous day’s close price of Rs. 1,022.35.
In Q4FY24 the Promoters of Max Financial Services Limited increased the pledge on their holdings in the company from 59.57 percent in Q3FY24 to 69.15 percent in Q4FY24 by an additional pledge of 9.58 percent.
Its revenue from operations grew by 38.89 percent from Rs. 8,896 Crores in Q3FY24 to Rs. 12,356 Crores in Q3FY24, accompanied by profits of Rs. 269 Crores to Rs. 171 Crores.
Lloyds Metals and Energy
Lloyds Metals and Energy Limited is engaged in the business of mining iron ore, manufacturing sponge iron, and generating power.
With a market capitalization of Rs. 34,612 Crores, the shares of Lloyds Metals and Energy Limited were trading at Rs. 685.05, down 1.38 percent from its previous day’s close price of Rs. 694.65.
In Q4FY24 the Promoters of Lloyds Metals and Energy Limited increased the pledge on their holdings in the company from 20.93 percent in Q3FY24 to 24.23 percent in Q4FY24 by an additional pledge of 3.30 percent.
Its revenue from operations grew by 91.1 percent from Rs. 1,000 Crores in Q3FY24 to Rs. 1,911 Crores in Q3FY24, accompanied by profits of Rs. 230 Crores to Rs. 332 Crores.
Aurobindo Pharma
Aurobindo Pharma Limited is engaged in the manufacturing and marketing of active pharmaceutical ingredients, branded pharmaceuticals, generic pharmaceuticals, and related services.
With a market capitalization of Rs. 62,557 Crores, the shares of Aurobindo Pharma Limited were trading at Rs. 1,067.65, down 1.68 percent from its previous day’s close price of Rs. 1,085.85.
In Q4FY24 the Promoters of Aurobindo Limited increased the pledge on their holdings in the company from 18.90 percent in Q3FY24 to 20.86 percent in Q4FY24 by an additional pledge of 1.96 percent.
Its revenue from operations grew by 14.74 percent from Rs. 6,407 Crores in Q3FY24 to Rs. 7,352 Crores in Q3FY24, accompanied by profits of Rs. 491 Crores to Rs. 940 Crores.
Aarti Industries
Aarti Industries Limited is engaged in manufacturing and dealing in Speciality Chemicals and Pharmaceuticals that include active pharmaceutical ingredients and intermediates, additives, agrochemicals, intermediates dyes, pigments, and many more
With a market capitalization of Rs. 26,399 Crores, the shares of Aarti Industries Limited were trading at Rs. 728.25, down 0.95 percent from its previous day’s close price of Rs. 735.25.
In Q4FY24 the Promoters of Aarti Industries Limited increased the pledge on their holdings in the company from 2.38 percent in Q3FY24 to 3.68 percent in Q4FY24 by an additional pledge of 1.30 percent.
Its revenue from operations grew by 3.83 percent from Rs. 1,668 Crores in Q3FY24 to Rs. 1,732 Crores in Q3FY24, accompanied by profits of Rs. 137 Crores to Rs. 124 Crores.
PVR Inox
PVR Inox Limited is engaged in the business of movie exhibition, distribution, and production also in-house advertising, sale of food and beverages (F&B), gaming, and restaurant business. It has approximately 1713 screens across its network all over India and other Regions.
With a market capitalization of Rs. 13,446 Crores, the shares of PVR Inox Limited were trading at Rs. 1,370.25, down 1.85 percent from its previous day’s close price of Rs. 1,396.10.
In Q4FY24 the Promoters of PVR inox Limited increased the pledge on their holdings in the company from 4.17 percent in Q3FY24 to 5.27 percent in Q4FY24 by an additional pledge of 1.10 percent.
Its revenue from operations grew by 64.46 percent from Rs. 940 Crores in Q3FY24 to Rs. 1,546 Crores in Q3FY24, accompanied by profits of Rs. 16 Crores to Rs. 13 Crores.
Written by: Bharath K.S
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