Institutions owning 3.43 crore votes were against the proposal to extend the term of Poddar. Institutional votes representing two crore shares backed it.
Promoter group owns 58% stake in the company while both — foreign portfolio investors (FPIs) and mutual funds — which constitute the institutional investor category, own 14% each. The company also has about 90,000 retail investors who together own 6.2%
Shares of Balkrishna Industries closed at Rs 2,294 apiece – up 0.9% on Friday.
The resolution dated June 30 however went through after the promoter group cast 11.2 crore votes in favour of the resolution. Eventually, the resolution passed with 80% approval, or 13 crore votes, in favour of it while 20%, or 3.43 crore votes, were cast against it, NSE data showed. It could not be ascertained which institutions voted against the proposal to reappoint Poddar.
HDFC Mutual Fund is the largest institutional investor in the company. Its Retirement Savings Hybrid Fund held 4.18% stake as on March 31, 2021, shareholding pattern showed. Kotak ESG Opportunities Fund and DSP Quant Fund owned 2.36% and 1.94% stake in the company, respectively.
An email sent to Balkrishna Industries remained unanswered.
Proxy advisory firm Stakeholders Empowerment Services (SES) in a report dated June 14 advised institutional investors to vote against the resolution citing ‘skewed remuneration’ structure.
“Out of the total board remuneration of `75.72 crore, Arvind Poddar, promoter chairman & managing director of the company, has been paid `37.42 crore and his son (Rajiv Poddar) is drawing another `37.32 crore. This aggregates to 99.6% of total board remuneration for FY21,” said the report. “This clearly indicates that the remuneration is skewed in favour of the promoters.”
SES also said that the salaries drawn by the Poddars were significantly higher than the company’s other full-time directors, who do not belong to the promoter group.
