Indigo Paints experienced a notable 6% drop in share value on Friday, reaching an intraday low of ₹1,452 on the National Stock Exchange (NSE) due to significant block deals. However, by mid-morning, the stock had partially recovered, trading at ₹1,482, down by 3.69%. Peak XV Partners, a venture capital firm formerly known as Sequoia Capital India, sold a substantial 22.04% stake in the company through its affiliates, raising an estimated ₹1,557 crore. This divestment saw investors like Morgan Stanley, Mercer, and HDFC Mutual Fund acquiring the shares.

Indigo Paints Faces Initial Drop Following Block Deals

Intraday Decline: Indigo Paints’ stock saw a sharp decline of 6%, falling to ₹1,452 per share on the NSE in early trading sessions due to large block deals.

Partial Recovery: By 11:15 AM, the shares recovered slightly from the lows, trading 3.69% lower at ₹1,482. Despite the recovery, the volatility raised concerns among investors.

Peak XV Partners Offloads Major Stake

Key Transaction: Reports indicated that Peak XV Partners, previously known as Sequoia Capital India, was the likely seller, divesting an 11% stake at ₹1,470 per share. This transaction was valued at ₹770 crore.

Public Shareholding: Prior to the deal, Peak XV Partners held a combined stake of 25.23% in Indigo Paints through two of its investment arms: Peak XV Partners Investments IV (12.14%) and Peak XV Partners Investments V (13.09%).

Strategic Acquisitions by Leading Investors

Stake Acquisition by Morgan Stanley: The significant stake sold by Peak XV Partners was acquired by institutional investors, including Morgan Stanley, Mercer, and HDFC Mutual Fund. Their participation demonstrates confidence in Indigo Paints' long-term growth potential.

Divestment Value: Peak XV Partners divested 1.05 crore shares, constituting a 22.04% stake in Indigo Paints. The total transaction value stood at ₹1,557 crore, reflecting robust demand from institutional buyers.

Background of Peak XV Partners and Indigo Paints

Peak XV Rebranding: Peak XV Partners underwent a rebranding in 2023, transitioning from Sequoia Capital India as part of a strategic restructuring within Sequoia’s global operations. This change positioned Peak XV as a separate entity focused on investments in the Indian and Southeast Asian markets.

Indigo Paints’ Growth Trajectory: Incorporated in 2000, Indigo Paints has emerged as the fastest-growing paint company in India, particularly among the top five players. The Pune-based company is known for its wide range of decorative and industrial coatings, driving its rapid expansion in the Indian market.