Hindustan Lever Ltd (HLL) has rescheduled the date of its annual general meeting (AGM) from May 10 to June 26 due to the uncertainty over the Finance Bill. The date has been changed to enable the company to place the resolution, if required for amending the scheme of issue of bonus debentures, which would constitute deemed dividend, subsequent to passing of Finance Bill 2002, HLL informed the Bombay Stock Exchange on Friday. With this, HLL’s plan to issue bonus debentures will be delayed further. There is a proposal in the Finance Bill to tax dividend in the hands of recipients (shareholders) and withdraw tax payable by companies on the dividend distributed by them. Such a proposal, if approved by Parliament would have significant impact on HLL’s proposed scheme of issue of bonus debentures in so far as taxability in hands of shareholders was concerned, it said. However, until the Finance Bill is passed and the position on tax on dividend income is finally known, HLL would not be in a position to take further steps with regard to implementation of the scheme, it said, adding depending on the final position, the company may have to modify the scheme and approach shareholders for requisite approval at the AGM. Earlier, the company had recommended a final dividend of Rs 2.5 per share of one rupee. Accordingly the final dividend as approved by shareholders at the aforesaid meeting would be payable on or after June 28, 2002. The HLL scrip came under severe selling pressure soon after the FMCG major, after trading hours on April 15, 2002, reported a sharp fall in its Q1 ended March 2002 sales. From its close of Rs 222.95 on April 15, 2002, the scrip in four trading sessions from the announcement of the results, lost 8.90 per cent to Rs 203.10 by April 19, 2002. Earlier this week, a sharp decline in HLL’s March 2002 quarter sales took marketmen by surprise. Though HLL, ahead of the results, had warned of a fall in its Q1 sales, the fall was sharper than expectations. It registered a 10% decline in top line to Rs 2,380.66 crore.
