Goldman Sachs Sells ₹48 Crore Ethos Shares; Stock Dips!
Goldman Sachs, a global investment firm, has divested a part of its stake in luxury watch retailer Ethos Ltd through a block deal, which was carried out at a 5% discount, resulting in a drop in the stock’s value.
Summary:
Goldman Sachs executed a significant block deal on Thursday, offloading over 1.77 lakh shares of Ethos Ltd, a prominent Indian luxury watch retailer, for ₹48 crore. The transaction was executed at a discount of approximately 5% to the previous closing price, leading to a sharp 4.45% intraday fall in Ethos’ stock price. Market participants remain watchful of further institutional exits in the smallcap segment amid ongoing volatility.
Goldman Sachs Sells ₹48 Crore Worth of Ethos Shares in Block Deal; Stock Falls 4.45%
In a significant secondary market transaction, global investment firm Goldman Sachs sold over 1.77 lakh shares of Ethos Ltd, valued at around ₹48 crore, via a block deal on Thursday, June 20. The shares were offloaded at a 5% discount to the previous day’s closing price, triggering a sharp decline in the stock, which fell 4.45% intraday as investors digested the development.
This transaction has sparked considerable attention in both institutional and retail circles, as Ethos — a key player in India’s growing premium and luxury retail space — has often been seen as a long-term consumption growth play.
Block Deal Details: Discounted Exit by Goldman Sachs
The block deal was executed at an average price of ₹2,700 per share, compared to Ethos’ prior closing price of approximately ₹2,842, representing a discount of nearly 5%. The total deal size amounted to ₹48 crore, with over 177,000 shares changing hands on the NSE and BSE combined.
Goldman Sachs, which had acquired a stake in Ethos Ltd during its early growth and IPO phase, appears to be realigning its portfolio by trimming exposure to selected smallcap stocks. The investment firm has been seen reducing its stake in several Indian small- and mid-cap companies over recent quarters, possibly due to profit booking, global risk-off sentiment, or a shift in investment strategy.
As of the latest shareholding pattern prior to the deal, Goldman Sachs held a significant minority stake in Ethos, although its exact post-deal holding is yet to be disclosed in regulatory filings.
Ethos Ltd: India’s Premier Luxury Watch Retailer
Ethos Ltd, headquartered in Chandigarh, is India’s leading luxury and premium watch retailer, with a portfolio that includes more than 60 brands such as Rolex, Omega, Bvlgari, Tissot, Longines, and Rado. The company operates both online and offline channels, with 50+ stores across major Indian cities.
Listed in May 2022 through an IPO priced at ₹878 per share, Ethos saw a strong debut and has been part of investor interest due to rising demand in the luxury retail segment in India. The company caters to India’s growing affluent class and millennials seeking high-end timepieces and lifestyle products.
Despite market volatility, Ethos has reported consistent revenue growth driven by expansion of physical footprint, increasing average order values, and growing brand partnerships. In the fiscal year 2023-24, the company posted a revenue of over ₹800 crore and aims to cross the ₹1,000 crore mark in FY25, riding on premiumization trends and digital transformation.
Market Reaction: Stock Slides on Supply Overhang
Following the block deal, Ethos stock fell sharply by 4.45%, closing at ₹2,715.80 on the NSE. The sharp decline was attributed to:
The 5% discount on the block deal price created a short-term bearish sentiment
Concerns about further institutional exits
Near-term supply overhang of shares in the market
Technical analysts noted that the stock has strong support at the ₹2,600 level, and any breach of this could lead to further weakness. However, long-term investors remain confident in the company’s fundamentals and growth trajectory.
Analyst View: Healthy Consolidation or Red Flag?
Brokerage firms and analysts were divided on the implications of Goldman Sachs’ move. Some interpreted the exit as part of a routine portfolio reshuffle, especially since Goldman Sachs has been booking profits in several emerging market positions. Others flagged concerns about a broader derating in smallcap stocks due to valuation excesses seen in specific segments.
“While institutional selling does raise eyebrows, Ethos’ business remains structurally sound. Investors should view this as a near-term supply-driven dip rather than a change in fundamentals,” said an analyst at a Mumbai-based brokerage.
Another point of concern is the liquidity in smallcap counters. Block deals of this magnitude can cause sharp price movements, especially when there’s a lack of matching institutional buying demand.
Ethos’ Growth Strategy: Expanding Horizons
Ethos is actively working on expanding its footprint into Tier-II and Tier-III cities, anticipating growing demand for luxury and aspirational products beyond metro cities. The company is also investing in:
Digital channels through its omnichannel platform
The pre-owned luxury watch segment, which is seeing increasing traction in India
Enhancing loyalty programs and personalization, supported by AI and CRM platforms
With a focus on sustainable growth, brand exclusivity, and customer experience, Ethos aims to solidify its leadership in India’s nascent but growing luxury retail space.
Conclusion: Block Deals, Not a Business Risk
While the sale by Goldman Sachs may weigh on Ethos’ stock in the short term, it doesn’t reflect operational or structural weaknesses. The company continues to enjoy leadership in a high-growth niche and is expected to benefit from rising disposable incomes, urban aspirations, and digital-first luxury consumers.
For long-term investors, this could represent a healthy correction and potential entry opportunity, provided the broader small-cap sentiment remains stable.
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