The deal comes on the heels of last weekβs significant transaction where Reliance Industries Ltd (RIL) offloaded a 3.6% equity stake in Asian Paints to SBI Mutual Fund through a block deal executed on Thursday.
SBI Mutual Fund, Indiaβs largest asset manager, acquired the 3.6% stake for Rs 7704 crore ($900 million), making it one of Indiaβs largest bilateral block deals. The shares were picked up at Rs 2201 apiece.
The deal allowed Reliance to monetize part of its long-term investment in Asian Paints, which it held via Siddhant Commercials Ltd. The transaction delivered a windfall to Reliance, translating into a near 23-fold return on a 17-year-old investment.
Technicals still weak
Asian Paintsβ stock has been under pressure. The shares have fallen 24.2% over the last year and are down 8% over the past six months. In the past month, the stock has declined 5%, including a 1.4% drop over the previous week.
On the technical front, the stock is trading below all eight of its key simple moving averages β from the 5-day to the 200-day SMA β reflecting broad bearish sentiment across short-term, medium-term, and long-term timeframes.
The Relative Strength Index (RSI) stands at 34.0, suggesting the stock is nearing oversold territory, while the Moving Average Convergence Divergence (MACD) is at -34.4 and remains below its signal and center line, a strong bearish indicator.
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