InvestorQ : Is it true that promoters of automobile companies in India are accumulating shares at lower levels? What does it mean for investors?
Tisha Malhotra made post

Is it true that promoters of automobile companies in India are accumulating shares at lower levels? What does it mean for investors?

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Sam Eswaran answered.
1 year ago
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Often promoters tend to buy shares of their own company in the event of a sharp correction. This gives confidence to the market and also to the investors that the promoter is putting money where their skin is. That favours in terms of being able to increase promoter stake and also review progress. Here are some samplers.

· Promoters of Hero Moto, Bajaj Auto, and Tata Motors Ltd have stepped up open market purchases of equity shares. Auto has lost 42% YTD.

· Among the specific instances, Hero Moto invested Rs.44 crore buying its own shares while Tata Sons invested Rs.118 crore to buy Tata Motors DVR.

“As the promoters have better visibility of their business, acquisition of additional equity from the open market means they are confident of the future. It gives a hint that promotes are willing to invest in their own shares.

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