Big investors shy away from big market deals
NEW DELHI Bearish conditions in the stock market have made corporate, FIIs and other big
investors to shy away from bulk and block deals, which involve transaction of large chunks of
shares of a company, leading to a nearly 30 per cent fall in trading volumes through such deals
in 2008.
Analysts believe that High Networth Individuals (HNIs), Foreign Institutional Investors and other
big corporate investors staying away from large-sized deals last year, lead the trading volume to
take a dip.
“Drop in the block and bulk deals shows that the HNIs and FIIs are preferring to stay away from
the market,” Nexgen Capital Equity Head Jagannadham Thunuguntla said.
The combined trading volumes of bulk and block deals on Bombay and National stock exchanges
have plunged 27 per cent, representing a decline of Rs1570 billion.
The bulk transactions fell 29 per cent to Rs1360 billion in 2008, while the block deals declined 11
per cent to Rs211.3 billion, in value terms.
A block deal, refers to a trade with a minimum quantity of 500, 000 shares or minimum value of
Rs50 million executed through a single transaction window on the bourse.
Whereas, a bulk deal involves the transaction in a scrip where the total quantity bought or sold is
more than 0.5 per cent of the entire outstanding shares of the listed entity.
Press Trust of India