New Delhi: Dalal Street veteran Rakesh Jhunjhunwala reduced his stake in VIP Industries during the March quarter. This information has been provided by the latest data released by the company. VIP is the country’s largest manufacturer of travel bags and suitcases.
Jhunjhunwala had a 5.31 per cent stake in VIP as of 31 December. It dropped 299 basis points (2.9 per cent) to 2.32 per cent by the end of March. It also includes the participation of his wife Rekha Jhunjhunwala.
ET could not independently ascertain whether Jhunjhunwala’s wife still holds the shares of the company as the companies disclose only the names of the investors who hold at least one per cent of the company in the major shareholders. There is a stake.
VIP Industries shares are in the grip of bears. On March 4, the share price was at Rs 421.95, which had jumped by 26 per cent to Rs 313 on Thursday. Axis Securities expects a loss of Rs 7 crore from the company in the March quarter, which was a profit of Rs 10 crore last year.
Prabhudas Liladhar said that the company registered good sales in January and February, but the second wave of Corona Virus in March had an impact on sales. 40% of the company’s sales come from Corona-affected states such as Maharashtra, Gujarat, Karnataka and Delhi-NCR.
In the third quarter, VIP sales were up 54 percent compared to Corona’s earlier levels, up 25 percent in the second quarter and just seven percent in the first quarter. Apart from this, due to inflation of raw materials, the company also had to increase the price of the products.
The brokerage said, “Generally the first quarter is the best for luggage companies. If Corona’s situation does not improve, sales could be affected as there is an increased possibility of cancellation of marriages and travel.”
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