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Tata Sons make 5:1 bonus issue

The company posted a net profit jump of 100 per cent.

Written by ENS Economic Bureau | Mumbai |
November 22, 2011 12:55:16 am

Tata Sons,the holding company of the Tata group,has made a bonus issue of 5:1 (five shares of the company of Rs 1,000 each for every one share held by the shareholders).

The unlisted company,which holds sizeable stakes in major Tata companies including Tata Steel,Tata Motors and Tata Power,has also decided to recommend the reappointment of FK Kavarana and RK Krishna Kumar to its board of directors and make R Gopalakrishnan a non-executive director,according to the 93rd Annual Report (2010-11) of Tata Sons.

The company posted a net profit of Rs 3,247 crore for the year ended March 2011 as against Rs 1,621 crore in the previous year,a jump of 100 per cent. Investments at cost as on March 31,2011 stood at Rs 37,081.35 crore as compared to Rs 32,368.57 crore as on March 31,2010,it disclosed.

While various Tata trusts own the majority stake in Tata Sons,Pallonji Mistry holds around 17-18 per cent stake in the company,making him the largest individual shareholder in the firm. Pallonji Mistry’s son Cyrus Mistry is on the board of Tata Sons.

“FK Kavarana and RK Krishna Kumar are liable to retire by rotation at the forthcoming annual general meeting and,being eligible,offer themselves for re-appointment. The board unanimously commends the re-appointments of Kavarana and Krishna Kumar,for the approval of the shareholders,” it said. “During the year,R Gopalakrishnan’s term as a whole-time director expired on December 25,2010 upon his reaching 65 years of age. To continue to avail of R Gopalakrishnan’s expertise,the board considered it appropriate to appoint Gopalakrishnan as a non-executive director subject to shareholders’ approval,” Tata Sons Annual Report said.

JJ Irani retired as a non-executive director of the company on June 2,2011,in accordance with the Retirement Age Policy laid down by the company. “Irani was associated with the company for over 14 years having joined the board of Tata Sons in June 1997 and served as a Director until June 2,2011,” it said. The directors have recommended the payment of dividend 800 per cent (previous year: interim dividend of 700 per cent) on the ordinary shares of the company,subject to the approval of the shareholders at the forthcoming AGM,it said. “During the year,the company continued to acquire shares and securities of its existing industrial enterprises as well as in newly promoted companies,” it said.

The company has been classified as a Non-Banking Non-Financial Company and is in the process of registering itself with Reserve Bank of India as a Core Investment Company (CIC),it added. The company is now in the process of identifying a successor to group supremo Ratan Tata who is scheduled to retire next year. The bonus issue will be a bonanza for all Tata group companies which own shares in Tata Sons.

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