Promoter Holding is calculated as shares held by promoters divided by total shares outstanding of the company. Promoters are individuals or corporations who invest for the purpose of gaining and holding onto stake in the company for very long periods of time. They are interested in running the company and may even hold board positions.

A very high or very low promoter ownership percentage is not desirable. A very high promoter stake will automatically lead to lesser holdings by institutional and retail investors. In such a situation, promoters might take decisions that is adversarial to retail shareholders interest. A very low promoter stake means promoters are not sufficiently invested in the company and might not be interested in running the company.