Promoter holding is one of the key things to look at while investing in a company.

 A larger share of promoter holding indicates the confidence of the people who run it and vice versa. But an unnaturally large shareholding means that there is very little of the company to offer to the public. This could increase an investor's risk. This is in the form of lower liquidity levels as well as lower decision making power for minority shareholders. Naturally the regulator, Securities and Exchange Board of India (SEBI) feels the same way as well. Therefore it is irked that many listed companies have not disclosed their shareholding details. As reported by Business Standard, 1,259 (25.3%) of the 4,977 listed companies have not given their shareholding details as of March 2012.

One reason for this has been the fact that many of these companies are not compliant with the minimum public shareholding norms. But the problem this year has been the limitation of avenues through which promoters could reduce their stake. With the topsy turvy way the share markets have been behaving, the equity market route has not been too conducive. Therefore, SEBI is looking to increase the avenues for disinvestment. The Board plans to meet soon and consider changes to the existing norms on disinvestment, etc. Hopefully they would be able to come out with norms that are conducive to both the shareholders as well as the promoters of the companies.