Shares of Mahindra and Mahindra (M&M) fell 4.25% to the day's low at Rs 1,885 on BSE in Thursday’s session amid a 0.8% equity block deal in which the promoters are likely to have sold partial stake. The conglomerate’s promoter group entity Prudential Management and Services (PMSL) was looking to sell stake in the company.
“Post transmission of shares of PMSL held by the former chairman of M&M, late Mr Keshub Mahindra (who passed away on 12th April 2023), to his family members, the family is looking for liquidity for specific needs, and hence proposes to sell a small number of shares held by PMSL in M&M,” M&M had said in an exchange filing.
The family shall continue to retain the status of the promoter group of M&M and there is no intention to sell further shares in the foreseeable future, it said. However, details about today’s block deal would be known in the evening when exchanges release data.
Also read | M&M promoter group entity initiates sale of shares; sale will reduce promoters’ stake to 18.57% from 19.32%
According to the term sheet for the share sale, PMSL will sell 9.3 million shares, equivalent to 0.75% of the company's stake, through block trades. The shares are offered in a price range of Rs 1,911.50 to Rs 1,970.65 apiece. At the upper end of the price range, the proceeds could be up to Rs 1,832 crore.
Mahindra's promoters collectively held a 19.32% stake in the company as of December 31. This included PMSL’s 11.64% holding, show the company’s shareholding data. PMSL is a private financial services company.
After the share sale, the promoter group's holding is expected to come down to 18.57%.
In the December quarter, M&M’s net profit jumped 61% year-on-year to Rs 2,454 crore, exceeding the average estimate of Rs 2,375 crore in an analyst poll by Bloomberg. Revenue grew 17% to Rs 25,289 crore.
M&M shares have rallied about 49% in the last one year.
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