General Atlantic to Sell 5.1% Stake in PNB Housing Finance

General Atlantic recently announced that it is planning to sell a 5.1% stake in PNB Housing Finance through an open market transaction on Wednesday. According to IIFL Securities, the firm will divest 1.33 crore shares at a floor price of Rs.775 each, aiming to raise approximately Rs.1,033 crore.

Stake & Other Transactions

As of June 30, 2024, General Atlantic holds a 5.13% stake in PNB Housing Finance. This sale follows a recent similar sale by Carlyle, another US-based private equity firm, which sold a 12.8% stake last month for Rs.2,578 crore. Earlier in June, General Atlantic, along with Asia Opportunities V (Mauritius), divested 2.45% stakes each, totaling Rs.1,004 crore. So, these transactions reflect a trend of such major stake sales in PNB Housing Finance by big investors.

Market & Discount  

The floor price of Rs.775 represents a 4.4% discount compared to the closing price of Rs.810.90 yesterday. This announcement comes as the stock has been performing well, with a 23.26% increase over the past year and a 3.26% rise year-to-date. The discount might be seen as a good decision to attract buyers, given the current market conditions.

Financial Highlights

PNB Housing Finance has shown solid financial performance recently. For the Q1FY25, the company reported a nearly 25% increase in consolidated net profit, reaching Rs.433 crore compared to Rs.347 crore in the same quarter the previous year. The company’s total disbursements rose by 19% to Rs.4,398 crore, while net interest income grew by 4% to Rs.651 crore.

Conclusion: In conclusion, the planned sale by General Atlantic adds to a series of divestments in PNB Housing Finance. With the floor price set below the recent closing price, the outcome of this transaction will be interesting to watch, especially in the context of the company’s financials and recent investor activities.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.