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Tata Motors DVR share price rises 10% after Rakesh Jhunjhunwala raises stake

Tata Motors DVR share price rises 10% after Rakesh Jhunjhunwala raises stake
October 21
19:04 2021

Meanwhile, Rakesh Jhunjhunwala reduced his stake in Tata Motors marginally to 1.11 percent in the quarter ended September 2021 from 1.14 percent in the June quarter

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var titStr=”;var editw=”; var typevar=”; var pparr= new Array(‘Monitoring your investments regularly is important.’,’Add your transaction details to monitor your stock`s performance.’,’You can also track your Transaction History and Capital Gains.’); var phead =’Why add to Portfolio?’; if(secglbVar ==1) { var stkdtxt=’this stock’; var fltxt=’ it ‘; typevar =’Stock ‘; if(lastRsrs.length>1){ stkdtxt=’these stocks’; typevar =’Stocks ‘;fltxt=’ them ‘; } } //var popretStr =lvPOPRHS(phead,pparr); //$ (‘#poprhsAdd’).html(popretStr); //$ (‘.btmbgnwr’).show(); var tickTxt =’‘; if(typparam1==1) { var modalContent = ‘Watchlist has been updated successfully.’; var modalStatus = ‘success’; //if error, use ‘error’ $ (‘.mc-modal-content’).text(modalContent); $ (‘.mc-modal-wrap’).css(‘display’,’flex’); $ (‘.mc-modal’).addClass(modalStatus); //var existsFlag=$ .inArray(‘added’,newappndStr[1]); //$ (‘#toptitleTXT’).html(tickTxt+typevar+’ to your watchlist’); //if(existsFlag == -1) //{ // if(lastRsrs.length > 1) // $ (‘#toptitleTXT’).html(tickTxt+typevar+’already exist in your watchlist’); // else // $ (‘#toptitleTXT’).html(tickTxt+typevar+’already exists in your watchlist’); // //} } //$ (‘.accdiv’).html(”); //$ (‘.accdiv’).html(appndStr); } }, //complete:function(d){ // if(typparam1==1) // { // watchlist_popup(‘open’); // } //} }); }); } else { var disNam =’stock’; if($ (‘#impact_option’).html()==’STOCKS’) disNam =’stock’; if($ (‘#impact_option’).html()==’MUTUAL FUNDS’) disNam =’mutual fund’; if($ (‘#impact_option’).html()==’COMMODITIES’) disNam =’commodity’; alert(‘Please select at least one ‘+disNam); } } else { AFTERLOGINCALLBACK = ‘overlayPopup(‘+e+’, ‘+t+’, ‘+n+’)’; commonPopRHS(); /*work_div = 1; typparam = t; typparam1 = n; check_login_pop(1)*/ } } function pcSavePort(param,call_pg,dispId) { var adtxt=”; if(readCookie(‘nnmc’)){ if(call_pg == “2”) { pass_sec = 2; } else { pass_sec = 1; } var url = ‘//www.moneycontrol.com/mccode/common/saveWatchlist.php’; $ .ajax({url:url, type:”POST”, //data:{q_f:3,wSec:1,dispid:$ (‘input[name=sc_dispid_port]’).val()}, data:{q_f:3,wSec:pass_sec,dispid:dispId}, dataType:”json”, success:function(d) { //var accStr= ”; //$ .each(d.ac,function(i,v) //{ // accStr+=”+v.nm+”; //}); $ .each(d.data,function(i,v) { if(v.flg == ‘0’) { var modalContent = ‘Scheme added to your portfolio.’; var modalStatus = ‘success’; //if error, use ‘error’ $ (‘.mc-modal-content’).text(modalContent); $ (‘.mc-modal-wrap’).css(‘display’,’flex’); $ (‘.mc-modal’).addClass(modalStatus); //$ (‘#acc_sel_port’).html(accStr); //$ (‘#mcpcp_addportfolio .form_field, .form_btn’).removeClass(‘disabled’); //$ (‘#mcpcp_addportfolio .form_field input, .form_field select, .form_btn input’).attr(‘disabled’, false); // //if(call_pg == “2”) //{ // adtxt =’ Scheme added to your portfolio We recommend you add transactional details to evaluate your investment better. x‘; //} //else //{ // adtxt =’ Stock added to your portfolio We recommend you add transactional details to evaluate your investment better. x‘; //} //$ (‘#mcpcp_addprof_info’).css(‘background-color’,’#eeffc8′); //$ (‘#mcpcp_addprof_info’).html(adtxt); //$ (‘#mcpcp_addprof_info’).show(); glbbid=v.id; } }); } }); } else { AFTERLOGINCALLBACK = ‘pcSavePort(‘+param+’, ‘+call_pg+’, ‘+dispId+’)’; commonPopRHS(); /*work_div = 1; typparam = t; typparam1 = n; check_login_pop(1)*/ } } function commonPopRHS(e) { /*var t = ($ (window).height() – $ (“#” + e).height()) / 2 + $ (window).scrollTop(); var n = ($ (window).width() – $ (“#” + e).width()) / 2 + $ (window).scrollLeft(); $ (“#” + e).css({ position: “absolute”, top: t, left: n }); $ (“#lightbox_cb,#” + e).fadeIn(300); $ (“#lightbox_cb”).remove(); $ (“body”).append(”); $ (“#lightbox_cb”).css({ filter: “alpha(opacity=80)” }).fadeIn()*/ $ (“#myframe”).attr(‘src’,’https://accounts.moneycontrol.com/mclogin/?d=2′); $ (“#LoginModal”).modal(); } function overlay(n) { document.getElementById(‘back’).style.width = document.body.clientWidth + “px”; document.getElementById(‘back’).style.height = document.body.clientHeight +”px”; document.getElementById(‘back’).style.display = ‘block’; jQuery.fn.center = function () { this.css(“position”,”absolute”); 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Tata Motors DVR share price rose 10 percent on October 21 to close at Rs 255.55 after the Ace investor Rakesh Jhunjhunwala increased his stake. Rakesh Jhunjhunwala has hiked his stake in Tata Motors DVR to 3.93 percent in the September quarter from 1.97 percent in the June quarter.

Among the foreign portfolio investors (FPIs), Vanguard Emerging Markets Stock Index Fund has raised its stake in the company from 4.58 percent to 4.68 percent.

Also Read – Rakesh Jhunjhunwala exits MCX, trims stakes in three other portfolio holdings

Meanwhile, Jhunjhunwala reduced his stake in Tata Motors marginally to 1.11 percent in the quarter ended September 2021 from 1.14 percent in the June quarter.

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Differential Voting Rights, or DVR, shares are the ones that are permitted to be issued with differential voting and differential dividend rights. DVR shares are different from ordinary shares in two distinct ways. Firstly, they offer lower voting rights compared to ordinary shares. These DVR shares are therefore very useful for companies that want to raise money in the market without diluting effective control of the company, according to a Motilal Oswal report.

Secondly, to compensate for the lower voting rights, these DVR shares are paid a dividend premium of 10-20%. This ideally should make sense for the small and retail shareholders as they normally do not participate in the voting process. Giving away part of their voting rights for higher dividends is a good ploy for these shareholders.

There is always a difference in the price of the company shares as compared to the DVR shares.

So the variation in the prices creates arbitrage opportunities, which traders always use. Tata Motors trades in cash as well as F&O segment, while Tata Motors DVR is available only in the cash segment. Sometimes, traders buy Tata Motors DVR in cash segment and short in Tata Motors in same quantities.

Image321102021

“Given above is the line chart of the ratio of Tata Motors versus Tata Motors DVR. It indicates that the ratio is now at 2.00 (Tata Motors divide by Tata Motors – around 1.98 or close to 2) and it is facing strong resistance at 2.10 which is the placement of 89 DEMA (Green colour line),” said Mehul Kothari of Anand Rathi Shares & Stock Brokers. DEMA is Double Exponential Moving Average.

In addition, “the falling trend line resistance construes that till the time these hurdles are not crossed the ratio could drop to 1.90 – 1.80. In such a  scenario, Tata Motors DVR could outperform Tata Motors stock on a temporary basis. On the contrary, whenever this breakout above 2.10 gets confirmed, we could witness strong outperformance of Tata Motors stock over Tata Motors DVR,” he said.

Image421102021

The third chart in the above image, which is difference between Tata Motors and Tata Motors DVR price, indicating that Tata Motors DVR should outperform, said Ashish Kyal, the founder of Waves Strategy Advisors.

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