Promoters of Max India, led by Analjit Singh, have increased their stake in the company to about 35 per cent last week and are expected to raise their holding further in the near future.
The promoter group increased stake by 0.69 per cent to 35.47 per cent through open market purchases in the last two trading sessions, sources close to the development said.
The promoters are committed to raise their stake further as they believe group's business has potential to grow multi-fold in profits as well as valuation in the future, sources said.
The company is into life insurance, health insurance and healthcare businesses through subsidiaries.
Sources said that the deals were executed at an average price of Rs 163.95 resulting in an investment of about Rs 26 crore.
According to an analyst, increase in stake by promoters shows confidence and conviction of the stakeholders in the underlying strength of the company's businesses of life insurance, health insurance, healthcare and clinical research.
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As a matter of fact, the promoters have been gradually increasing their stake in Max India, which has an annual turnover of around Rs 7,700 crore, since 2007.
Recently, they had also subscribed to warrants convertible into a 3 per cent equity stake in the company through an investment of Rs 173.4 crore.
Besides, Max India raised around Rs 522 crore through issuance of Compulsory Convertible Debenture (CCDs) to Goldman Sachs, which post conversion would represent a 9.1 per cent stake in the company.
Foreign institutional Investors (FIIs) have about 28 per cent stake in the company in addition to foreign direct investment. Leading global private equity firm Warburg Pincus alone holds 16 per cent stake in the company.
The company's flagship business Max New York Life Insurance is a joint venture with the US-based New York Life. Besides, it runs 8 hospitals in the Delhi NCR region through its subsidiary Max Healthcare.
Recently, it has entered into health insurance with the launch of Max Bupa, a 74:26 JV with the UK-based Bupa.