Why Did Rakesh Jhunjhunwala and Associates Sell Stake in this Smallcap Company?

The stock market is challenging for inexperienced investors to make buy, hold or sell decisions.

To avoid this difficulty, the investment approach of imitating the portfolios of financial gurus has become increasingly popular.

The primary idea behind this strategy is to look at the buying and selling behavior of investing gurus and base personal investment decisions on that.

One such guru that has often been under the radar of retail investors is Rakesh Jhunjhunwala. Rakesh Jhunjhunwala's secrets to investment has fetched him millions.

Today, we present to you one such move from the portfolio of the late renowned investor Rakesh Jhunjhunwala. This stock is among the 5 penny stocks investment held by him.

A word about Rakesh Jhunjhunwala

Rakesh Jhunjhunwala was an Indian billionaire stock trader and investor.

He used to manage his portfolio as a partner in his asset management firm, Rare Enterprises. He invested in both his own and his wife's name, Rekha Jhunjhunwala. He held the designation of Chartered Accountant.

Rakesh Jhunjhunwala was known as "India's Warren Buffett." According to Forbes, Jhunjhunwala was the 36th richest man in the country. He was worth Rs 460 bn when he passed away on 14 August 2022.

He was a director on the boards of several companies, including Viceroy Hotels, Concord Biotech, Provogue India, and Geojit Financial Services.

Why did Rakesh Jhunjhunwala and Associates sell a stake in Bilcare?

According to data on the exchanges, Rekha Jhunjhunwala, wife of late Rakesh Jhunjhunwala, sold 0.5% of his stake in smallcap company Bilcare through a bulk deal on 9 January 2023.

She sold approximately 135,994 shares of the packaging solution provider at Rs 41.8 a share, aggregating to Rs 6.5 m, taking the total shareholding to below 1%.

According to data available on Trendlyne, the associate has made a SAST (Substantial Acquisition of Shares and Takeovers) transaction in Bilcare for 580,569 share disposal.

Rakesh Jhunjhunwala has been an investor in this company since 2004.

He held a 7.4% stake in the company in the June 2018 quarter, as per the data available on BSE. This holding fell below 1% in September 2022 quarter.

While we don't know for certain why the 'Big Bull' decided to reduce his stake, there are some explanations.

In 2022, high raw material costs were a major setback for packaging companies, dragging most packaging stocks down.

Bilcare was one of them. The company's value halved last year and hit an over two-year low of Rs 31.1 in December 2022.

However, in the last one month, input costs have cooled down. As a result, the company's shares have rallied by a whopping 26%.

Thus, the recent rally in the stock might have prompted the investor to book some profit.

How Bilcare shares have performed recently

Bilcare shares have jumped by more than 26% in the last month. Over the year, the stock is down than 47.5%.

The company touched its 52-week high of Rs 114.4 on 18 January 2022 and its 52-week low of Rs 31.1 on 22 December 2022.

At the current price, the stock is trading at a price-to-book value multiple of 3.3.

About Bilcare

Bilcare is market leader in pharma packaging, packaging innovation and research that partners with the pharmaceutical industry to improve patient health-care outcomes.

It is a research-based organisation primarily engaged in manufacturing specialty pharmaceutical packaging barrier films. The company provides pharmaceutical research services, clinical services, and packaging systems and material.

The company's products include packaging films, aluminum foils wrap, systems cold formed blisters closures, and paper composites.

They also offer research services, including formulation development, analytical research stability studies, packaging audit, and packaging development and design.

To know more about company, check out the Bilcare company fact sheet and quarterly results. on our website.

You can also compare Bilcare with its peers:

Bilcare vs Apollo Pipes

Bilcare vs Astral

To know what's moving the Indian stock markets today, check out the most recent share market updates here.

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