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Explanation: Promoter pledge refers to the percentage of shares held by the promoters of a company that have been pledged as collateral to secure loans or other financial obligations. When promoters pledge their shares, they provide them as security to lenders in exchange for funding. The level of promoter pledge is an important indicator of the financial health and stability of a company, as a high pledge percentage may indicate liquidity concerns or financial distress.
Example: TCS has a promoter pledge of 0.48%, indicating that a small percentage of shares held by TCS’s promoters have been pledged as collateral. This suggests that TCS’s promoters have relatively low exposure to pledged shares, which may signify a lower risk of financial instability or liquidity challenges. Monitoring changes in the level of promoter pledge can provide insights into the financial risk profile of a company and its promoters’ confidence in the business’s prospects.
You can view percentage of Promoter Pledge in any company on Radar in the ShareHolding section.