Privi Chemicals Tanks 13% After ₹1,086 Crore Block Deal

Introduction

Shares of Privi Speciality Chemicals Ltd. experienced a sharp decline of as much as 13% on Wednesday, December 31, after a substantial block deal involving promoter entities. The transaction saw equity worth ₹1,086 crore change hands, triggering significant selling pressure on the stock throughout the trading session.

The Block Deal in Detail

According to exchange data, a total of 38.8 lakh shares, which constitutes 9.93% of the company's total outstanding equity, were traded in a large transaction. The shares were exchanged at an average price of ₹2,799 per share, bringing the total deal value to ₹1,086 crore. Bulk deal data later revealed that the promoter entity, Vivira Investment and Trading Pvt Ltd, was the primary seller. Vivira Investment offloaded 36.28 lakh shares, or a 9.28% stake, for approximately ₹1,029.8 crore at an average price of ₹2,838 per share.

Institutional Buyers Absorb Supply

Despite the large stake sale from the promoter group, the deal saw strong interest from institutional investors. SBI Mutual Fund emerged as a major buyer, acquiring 22.4 lakh shares, equivalent to a 5.73% stake, for ₹634.8 crore. The purchase was made at an average price of ₹2,833.96 per share. Prior to this transaction, SBI Mutual Fund already held a 3.64% stake in the company through its Multi Asset Allocation Fund. Another investor, Bhaumikbhai Kiritbhai Doshi, also purchased 1.88 lakh shares for ₹53.39 crore.

Impact on Share Price and Market Reaction

The news of the block deal led to immediate and intense selling pressure on Privi Speciality Chemicals' stock. The share price plunged 13% to an intraday low of ₹2,751. By the end of the day, the stock was trading 12.4% lower at ₹2,794.3. The floor price for the deal was reportedly set in the range of ₹2,835 to ₹2,850 per share, which represented an 11.1% discount to the previous day's closing price of ₹3,190.50.

Changes in Promoter Holding

This transaction marks the second time in the year that promoters have reduced their stake in the company. At the end of the September 2025 quarter, the promoter group held a 69.89% stake in Privi Speciality Chemicals. Earlier in June, four promoter entities had collectively sold a 4.09% stake for ₹330 crore through open market transactions. Following that sale, the promoter holding had decreased from 74.05% to just under 70%. The latest sale further dilutes the promoter's stake significantly.

| Block Deal Summary (December 31, 2025) | | :--- | :--- | | Seller | Vivira Investment and Trading Pvt Ltd (Promoter) | | Shares Sold | 36.28 lakh (9.28% stake) | | Sale Value | ~₹1,029.8 crore | | Primary Buyer | SBI Mutual Fund | | Shares Bought | 22.4 lakh (5.73% stake) | | Purchase Value | ~₹634.8 crore |

Stock Performance and Analyst Outlook

Despite the sharp fall on the day of the deal, the stock has had a strong run in 2025, gaining approximately 65% year-to-date. This marks its best calendar year performance since 2021, when it surged over 240%. Analysts remain positive on the company's long-term prospects. Motilal Oswal, for instance, maintains a 'Buy' rating on the stock with a target price of ₹3,960. The brokerage expects the company to benefit from the growing global aroma chemicals market and deliver strong revenue and EBITDA growth, driven by planned capacity expansions and a focus on high-margin products.

Conclusion

The significant stake sale by a promoter entity in Privi Speciality Chemicals caused a sharp, albeit temporary, correction in its stock price. The transaction was largely absorbed by institutional investors like SBI Mutual Fund, indicating continued confidence in the company's fundamental business. While the reduction in promoter holding will be a key factor for investors to monitor, the company's strong market position and positive analyst outlook suggest that its long-term growth story remains intact. Future movements will likely depend on the company's ability to execute its expansion plans and maintain its growth trajectory.