Promoter Selling Misconceptions: Unveiling Why These Three Incidents Exceed Ordinary Scenarios
In the financial year 2025, both Capri Global and Aptus Value Housing Finance India have shown impressive growth and improved asset quality, according to recent reports.
Capri Global, a diverse financial services company operating in sectors such as gold loans, MSME, construction finance, housing finance, and indirect lending, witnessed a significant increase in its consolidated assets under management (AUM). The company's AUM grew by 46% to ₹228.6 billion in FY25. This growth was accompanied by a 71% increase in profit after tax (PAT) to ₹47.8 billion and a pre-provision operating profit of ₹73.4 billion. Capri Global's return on average assets jumped 55 bps to 2.7% in FY25, and its net interest income rose to ₹133.2 billion, with a net interest margin of 8.8%.
Capri Global trades at a price-to-book multiple of 3.4x, which is at a premium to its 10-year median of 2.8x. However, it's important to note that this premium could be due to the company's strong growth and improved asset quality.
The company's asset quality also improved, with net NPA and gross NPA improving to 0.9% and 1.5%, respectively. Capri Global currently operates with a total of 1,111 branches, with 803 gold loan branches and 308 non-gold loan branches.
Meanwhile, Aptus Value Housing Finance India, a housing finance company with a focus on serving self-employed individuals from the informal sector, saw its consolidated AUM reach ₹108.6 billion as of March 31, 2025. Housing loans comprise 60% of the AUM. Geographically, Andhra Pradesh accounts for 42.3% of Aptus Value Housing Finance India's AUM, followed by Tamil Nadu (33.4%).
The internal rate of return (IRR) for home loans at Aptus Value Housing Finance India typically ranges between 13 and 15.50%, while non-home loans can offer returns of up to 22%.
Promoters have sold shares in Sagility India, Aptus Value Housing Finance India, and Capri Global Capital despite the strong growth shown by these companies. This pattern of promoter selling can include motives like raising funds for the business, profit booking by private equity investors, or meeting other financial or strategic objectives. Therefore, promoter share sales in these cases do not directly indicate weak business prospects but rather regulatory compliance or portfolio management decisions.
Sagility, a pure-play business process management service provider in the healthcare sector, reported a revenue growth of 18% year-on-year to ₹15.4 billion in Q1FY26, with its profit after tax (PAT) also rising 18.6%. As of March 31, 2025, the promoter group held a 52.99% stake in Aptus Value Housing Finance India, with WestBridge Crossover Fund LLC holding 29% and founder-promoter M Anandan and his family holding 23.9%. WestBridge sold a 12.4% stake during the June quarter, reducing the total promoter stake to 40.4%.
In summary, Capri Global and Aptus Value Housing Finance India have shown strong growth and improved asset quality in the financial year 2025. Despite promoter share sales in these companies, the strong growth trajectory remains, with Capri Global aiming for a strong growth of 27-30% annually over the next few years.
Investors might consider adding Capri Global stocks to their portfolios, given its significant growth in assets under management (AUM) and profitable trading outcomes. The market has valued Capri Global at a premium, with a price-to-book multiple of 3.4x, reflecting its strong growth and improved asset quality. The housing finance company, Aptus Value Housing Finance India, also demonstrated impressive growth in its consolidated AUM and has promising investment opportunities, offering internal rates of return (IRR) of up to 22% for non-home loans. Furthermore, promotion of business and finance-oriented efforts, like trading, investing, and Defi, can promote a more diverse approach within one's investment portfolio. However, it's crucial to carefully analyze promoter share sales in companies like Capri Global, Sagility, or Aptus Value Housing Finance India to ensure they don't indicate weak business prospects but rather strategic or regulatory decisions.
