'Promoter selling at record levels in 2023': Zerodha's Nikhil Kamath cautions market investors 
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'Promoter selling at record levels in 2023': Zerodha's Nikhil Kamath cautions market investors At a time when Indian stock markets are at their all-time highs, Zerodha's Nikhil Kamath flagged a "scary metric" to his followers on X platform.
On Monday, Kamath flagged that promoter selling in 2023 in India has been four times higher than 2018 and twice as much than 2022.
"This is a particularly scary metric. Can't be a good sign, if the equity you are buying in a company is being sold by the people running that company," posted Kamath on X (formerly Twitter) along with data to support his statement.
At Rs 80,754 crore, promoter selling in 2023 (till August) is four times more when compared to 2018 levels (Rs 19,258 crore) and double compared to 2022 (Rs 41,020 crore) in India, posted Kamath quoting data from CNBC and Prime Database.
2023 has seen the highest promoter selling in a particular calendar year, the data showed.
The promoter selling levels in 2023 are 0.3% of the average market capitalisation as compared to 0.13% in 2018.
Promoters are people who control the affairs of the company, directly or indirectly be it as a shareholder, director, or otherwise.
Netizens agreed with Kamath's hypothesis.
"Higher the promoter holding, higher the operators activity," said one X user.
Capital Mind CEO Deepak Shenoy had a different take on Kamath's post.
"I think many of these promoters are no longer running the company - Gangwal in Indigo (sold 3000 cr), Abrdn in HDFC AMC (4000 cr) etc. Plus the Adani sale (more than 15,000 cr.) where things are a little more complicated. I don't think a lot of operating promoters are selling," said Shenoy.
"Promoters selling their equity can be a canary in the coal mine. It's a reminder for investors to do their due diligence and dig deeper into the company's health and prospects. It's a puzzle worth solving before making any investment moves," quipped an X user.
India's blue-chip stock indexes eased from record highs on Monday, with the Sensex ending a 11-session winning streak, as investors remained cautious ahead of the U.S. Federal Reserve's interest rate decision.
The benchmark Nifty 50 fell 0.3% to 20,133.3 points, while the S&P BSE Sensex slipped 0.4% to 67,596.8 points.
Both benchmarks had gained nearly 2% each last week and closed at record highs.
Indian markets were closed on Tuesday due to Ganesh Chaturthi.
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