KPR Mill shares fall 7% in early deals; here's why

Shares of KPR Mill Ltd. fell over 7% on Wednesday, May 21, following a significant block deal executed early in the trading session. Approximately 1.1 crore shares, representing 3.2% of KPR Mill's outstanding equity, were exchanged, causing a notable impact on the stock's performance. The transaction, according to available data, lacked disclosed details regarding the average price and the identities of the sellers and buyers.

The promoters, KP Ramasamy, KPD Sigamani, and P Nataraj, were reportedly looking to divest up to 3.2% of their stake through these block deals. The total offer size is estimated at Rs 1,195.6 crore, with a floor price set at Rs 1,107 per share, reflecting a 10% discount from the stock's last closing price. As per the sources, IIFL Capital Services Ltd. has been appointed as the designated broker for this block deal, and a 90-day lock-in period will apply to sellers following the transaction.

At the end of the March quarter, the promoters each held a 20.34% stake in KPR Mill. The company's revenue for the March quarter increased by 4% to Rs 1,769 crore compared to the previous year. However, its EBITDA margin narrowed by nearly 100 basis points, and net profit saw a 4% decrease to Rs 204 crore. KPR Mill, a manufacturer of textiles including yarn and knitted fabric, saw its shares trade at a significant discount due to this transaction. The move comes amid efforts by the promoters to adjust their holdings in the company, impacting the stock's market perception and future outlook.