FY03 was shopping time for promoters, investors

Prompted by bearish sentiment on bourses, promoters, strategic investors and fund managers seem to have been on an equity buying spree during last fiscal. The perception that prevailing valuations were very, very low seemed to have spurred buying across 200-odd companies.

The result? Promoters and other privileged investors acquired 250 million shares with an approximate market value of Rs 1,200 crore (Rs 12 billion) in 2002-2003.

The information was culled from the data on open market purchases made available by the two major exchanges, the Bombay Stock Exchange and the National Stock Exchange. This data became available because, according to the Securities and Exchange Board of India code, it is mandatory for promoters and investors to reveal market purchases.

The companies targeted were from all categories - small, medium and big. The big names included BSES, Chambal Fertilisers, Eicher, Forbes Gokak, Apollo Hospitals, Cummins India and Jindal Iron & Steel. Small-cap companies too found a mention in the list.

These included Gini Silk Mills, Gujarat Ambuja Exports, Garden Silk, Jupiter Biotech, Prime Property Development, Samkrg Piston and Shree Steel Wire Ropes.

Among those on an acquisition spree, Reliance Power Ventures, an Ambani group company, acquired 6.2 per cent or 8.53 million shares in BSES during 2002-2003 through open market purchases on the BSE and NSE.  As a result, the Reliance group's shareholding in BSES increased from 37.92 per cent to 44.12 per cent.

Sterling Investment Corporation acquired 7.8 million (62.92 per cent) shares of Forbes Gokak through open market transactions and negotiated deals.

Others eyeing the Gokak stake were Shapoorji Pallonji and Co which acquired 3.81 per cent and Cyrus Investments which picked up 2.84 per cent during the year.

In Bank of Rajasthan, Cyber Info Zeebooma.com and 21st Century Entertainment acquired 20 lakh shares each. Cyber Infosystems acquired 1.6 million shares through market purchases.

Gini Silk Mills' chairman, Vishwanath Harlalka, acquired 660,000 equity shares of his company and Deepak Harlalka, managing director, acquired 143,000 equity shares from the open market during the financial year.

Some promoters too went on a share acquisition spree, but took a different route to do so. They acquired stakes in their companies through off-market deals, primarily inter se transfers.

Dail Investments acquired controlling stake of 61.5 per cent in Andhra Cements from its holding company, Duncans Industries. It also acquired shares of Consolidated Fibres, Gujarat Carbon, Star Paper Mills and Stones India.

Alliance Capital Mutual Fund acquired the shares of Digital GlobalSoft, e-Serve International, Hinduja TMT, Mastek, Polaris Software and United Phosphorus.

This was through open market purchases. UTI, too, bought 93,650 shares of ABB through open market operations.

Madison Holdings Ltd, an affiliate of Warburg Pincus & Co, too followed the market purchase route and acquired 1.68 crore or 5.33 per cent of Satyam Computer Services in 2002-2003.