Piramal Enterprises sells its entire investment in Shriram Finance in a block sale, lifting its shares up 15%.

As a result of Piramal Enterprises (PEL) selling its entire 8.34% ownership in the company through block agreements, shares of Shriram Finance remained caught in the 15% upper circuit on NSE during Wednesday's trade.

The stock also reached a new 52-week high of Rs 1,793.55 during this process. Piramal Enterprises' stock, meanwhile, surged almost 12% in the first trade.

The company sold its entire direct stake of 8.34% in the fully paid-up share capital of Shriram Finance Limited to third-party shareholders, on the floor of the stock exchange," Piramal Enterprises stated in a report to exchanges.

Another big deal in the financial services industry would be the sale of PEL's interest in Shriram Finance, which is anticipated to be worth Rs 4,630 crore. According to The Economic Times, the floor price was established at Rs 1,483 per share, a 4.9% drop from the NSE's closing price of Rs 1,559.85 on Tuesday.

The only placement agent for this transaction was Morgan Stanley India. Over 41 lakh shares were traded at 9:50 am, which was during the purchasing activity in Shriram Finance. Around the same time, almost 37 lakh shares of Piramal Enterprises stock were also traded.

Piramal Enterprises sold the domestic pharmaceutical formulations division to Abbott Laboratories in FY13 for a price of Rs 17,000 crore, and a portion of the revenues were invested in Shriram Group enterprises. According to a Crisil report, Piramal invested Rs 4,583 crore among three Shriram Group companies.

Shriram Transport Finance Co.'s 9.9% equity share was purchased for Rs 1,636 crore in May 2013. A further investment of Rs 2,014 crore was made in April 2014 to acquire a 20% equity position in Shriram Capital. Shriram Transport Finance Corp's investment was later sold for Rs 2,300 crore in June 2019. Shriram Transport Finance (STFL) was renamed Shriram Finance in 2022 after merging with Shriram City Union and the demerged undertaking of Shriram Capital.

As of March 31, 2023, Shriram financing, which includes housing financing businesses, has an AUM of Rs 193,730 crore (including SHFL), making it the fourth-largest non-bank lender in India, according to a Crisil study.