Domus Holdings Pvt Ltd, a relatively little known entity, has picked up 4.839% stake in Karur Vysya Bank (KVB). This has made it the second largest stake holder in one of the mid-sized, old generation private sector banks in the country.

Lotus Global Investment Ltd, the Mauritius arm of Swiss private equity investor BTS, is the single largest stake holder in KVB, while Bangalore-based GMR group is a close third with 4.596% stake in the bank.

Promoters are holding only 3.77% stake in KVB, putting the bank in the bulls-eye. Interestingly, Domus Holdings had sold its entire shareholding in two non-banking finance companies (NBFCs) to the GMR group in the past. GMR, however, denied any association with Domus Holdings Pvt Ltd.

According to the latest shareholding pattern of KVB, as of the end of the December quarter, Domus Holdings was holding 26,10,806 shares in KVB, which translate into 4.839% stake in the bank while GMR and its associates were holding 24,79,228 share, which work out to be 4.596% stake in the bank. Lotus Global, which has been an investor in KVB for the past few quarters, were holding 26,51,307 shares in the bank accounting for 4.914% stake.

Other major investors in KVB are Swiss Finance Corporation (4.422%), Subramanian Subbiah (4.105%), Rajesh Jhunjhunwala (3.417%), Platinum Investment Management Ltd (2.133%), Goldman Sachs (1.712%), Acacia Partners (1.64%), DSP Merryllynch (1.292%), Deutsche Securities (1.16%) and GB International (1.037%).

According to sources, Domus Holdings must have picked up the stake in KVB from open market between October-December 2008 through open market operations. Domus did not figure in the list of shareholders of KVB during the quarter ended October, 2008. The other entity which had picked stake in KVB between October-December 2008 is GB International Pvt Ltd.

Sources said that the investment by Domus Holdings in KVB might be purely borne out of financial considerations and it would not have any material bearings on KVB in the near future. “Domus is a relatively unknown entity which has interest in the non-banking financial vertical. It had sold its entire shareholding in Roshan Investments Pvt Ltd and Bluemoon Investments Pvt Ltd to the GMR group in September 2007.