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People in the <keyword id="6355725" type="CITY" weightage="20" keywordseo="Tata-Group">Tata Group</keyword> of companies are divided over removing <keyword id="6356895" type="PERSON" weightage="100" keywordseo="Cyrus-Mistry">Cyrus Mistry</keyword> from the board of directors and it seems <keyword id="6360722" type="PERSON" weightage="100" keywordseo="ratan-tata">Ratan Tata</keyword> will have a tough time in taking a decision in this regard. 
 Ratan Tata appealed to shareholders to remove Mistry from the boards of Tata Group companies and said his continuation will be a serious disruptive influence and will make the companies dysfunctional given his open hostility to primary promoter <keyword id="46894" type="PERSON" weightage="20" keywordseo="Tata-Sons">Tata Sons</keyword>. 
 
"As you would expect the deliberated action by the Tata Sons board was taken after the relationship with Mr. Mistry steadily deteriorated and several attempts to remediate went unheeded," Tata wrote in a letter. 
 
Tata also said Mistry was appointed as a director of various Tata Group companies only as corollary to his being the chairman of Tata Sons and it would be the correct step by him that he would have been to resign as director. 
 
However, InGovern, an advisory body, said Tata Sons did not provide any compelling reasons for removal of Mistry as a director from the boards of the operating companies. 
 
"Shareholders need to question inherent assumptions made regarding the value of the Group structure and the value of "Tata, brand and demand greater disclosures on information flow between Tata Sons and operating companies,"said Shriram Subramanian, Founder and Managing Director of the InGovern. 
 
The advisory body also added that the group has not articulated any new plans or visions for the operating companies than what the Boards under Cyrus Mistry had adopted. 
 
The tussle between Tatas and Mistry started when the latter was removed as Tata Sons Chairman. Since then, war of words has escalated between the two. Mistry has accused Tatas of running businesses as “legacy hotspots”, while Tatas said Mistry did not perform well in the capacity of the Chairman. 
(image: IndiaTimes)

Tata camp divided over removing Cyrus Mistry from board, Ratan Tata says his presence will be disruptive

Rift between the founders and the management board in <a href="http://www.businessinsider.in/searchresult.cms?query=infosys&amp;sortorder=effectivedate">Infosys </a>has been widening since more than one year now. The two sides are at loggerheads over the large severance paid to former <a href="http://www.businessinsider.in/searchresult.cms?query=rajiv+bansal&amp;sortorder=effectivedate">CEO Rajiv Bansal</a>, disclosed in 2016, and<a href="http://www.businessinsider.in/searchresult.cms?query=vishal+sikka&amp;sortorder=effectivedate"> CEO Vishal Sikka</a> ($11million). 
 
The founders are upset and as per several media reports, some promoters were also upset with the appointment of Punita Kumar-Sinha, an investment banker and wife of Union minister Jayant Sinha, as an independent director. 
 However, the main reason behind the dispute is governance issue and “violation of core <keyword id="6354512" type="CITY" weightage="100" keywordseo="Infosys">Infosys</keyword> values”. 
 
ET reported some of the founders have held the board responsible for what they perceive to be its inability to enforce governance norms. In July 2016, one of Infosys' prominent promoters reached out to a top legal professional in Mumbai. 
 The agenda: to hunt for a co-chairman for Infosys. This, despite the fact that <keyword id="484178" type="PERSON" weightage="20" keywordseo="R-Seshasayee">R Seshasayee</keyword> had been serving as Infosys non-executive chairman for just a year, since his appointment in June 2015. 
 
"The idea was to look for someone who understood core values of Infosys,” an executive told ET. 
 
A few names were thrown up as candidates, including a former Infosys finance hotshot and a retired founder. But the idea fizzled out as Seshasayee stepped down on July 28 as non-executive vice-chairman of Ashok Leyland - a post he had held since 2011- to focus on Infosys. 
 
Industry experts told ET the situation is not yet past the point of no return. "The end goal is the promoters, the board and the management should be aligned. I don't think the situation is irredeemable. If the founders air their problems, this could still be resolved. This isn't like the Tata case,” Shriram Subramanian, MD of shareholder advisory firm InGovern, told ET. 
 
Meanwhile, efforts are going on resolve the dispute. ET quoted two people saying among those involved is a prominent investor in the company - Baburaj Pillai. 
 
Reports of disputes over "internal governance issues, between some of the company's founders and a management keen on charting a new path have spurred efforts to broker peace by the Singapore-based fund manager as well as other influential people, said the sources cited above. 
 
Pillai, the founder of investment firm Arohi Capital, met with co-founder <a href="http://www.businessinsider.in/searchresult.cms?query=narayana+murthy&amp;sortorder=effectivedate">NR Narayana Murthy </a>and chief executive officer <keyword id="6369763" type="PERSON" weightage="20" keywordseo="Vishal-Sikka">Vishal Sikka</keyword> late last year, according to people aware of the talks. 
 
"Pillai met with both of them to try and create common ground. He does not want Sikka to be forced to leave and he also does not want Murthy to feel as though his voice is not important,” one of the people aware of the discussions told ET. 
 
"With regard to concerns on governance being discussed in the media, we would like to reiterate that all decisions have been made bona fide, in the overall interest of the company, and that full disclosures have already been made thereon,” Infosys told ET in a statement.

Trouble is brewing between Infosys founders and board. Here’s everything you should know

On Thursday, the <keyword id="19925636" type="General" weightage="20" keywordseo="stock-market" source="keywords">stock market</keyword> commenced its trading session on an even keel, with both the <keyword id="19896382" type="General" weightage="20" keywordseo="Sensex" source="keywords">Sensex</keyword> and <keyword id="19896381" type="General" weightage="20" keywordseo="Nifty" source="keywords">Nifty</keyword> indices initiating the day with minor losses. The Sensex index declined by 84.98 points, commencing at 80,166.96, whereas the Nifty index experienced a diminution of 15.35 points, initiating trading at 24,420.15. Among the constituents of the Nifty index, the market landscape exhibited a slight negative bias, with 21 stocks registering gains, 27 encountering declines, and 2 maintaining their previous values. <div type="Article" hostid="261" msid="114508632" title="Waaree Energies IPO allotment – How to check allotment, IPO GMP, listing date and more" mstype="2" mssubtype="0"></div> Trent, HDFC Bank, Sun Pharma, HCL Technologies, and Hero MotoCorp emerged as the <keyword id="20859131" type="General" weightage="20" keywordseo="top-gainers" source="keywords">top gainers</keyword>, showing resilience despite the cautious market sentiment. In contrast, Hindalco, SBI Life, Hindustan Unilever, Britannia, and Tata Consumer Products led the list of <keyword id="23664977" type="General" weightage="20" keywordseo="top-losers" source="keywords">top losers</keyword>. Foreign Institutional Investors (FIIs) offloaded equities worth ₹5,684.63 crore on Wednesday. Domestic Institutional Investors (DIIs) bought equities worth ₹6,039.90 crore. Shriram Subramanian, Founder and MD of InGovern Research Services, commented on the market trend, stating, "Markets have absorbed much of the selling by FIIs as DIIs continue to buy. Some mid and small caps stocks are available at attractive valuations. <keyword id="20187215" type="General" weightage="20" keywordseo="large-cap-stocks" source="keywords">Large cap stocks</keyword> will continue to attract flows." Varun Aggarwal, founder and MD of Profit Idea, said, "The average directional index (ADX) average line is trending upward, indicating continued weakness, and options data shows a rangebound movement expected for today and tomorrow's expiry, with heightened activity around the 24,500 level." The market's subdued opening reflects a cautious outlook as investors weigh global and domestic factors, with stock-specific movements driving the day's activity. With inputs from ANI. SEE ALSO: <a href="https://www.businessinsider.in/stock-market/webstories/afcons-infrastructure-ipo-gmp-risk-factors-and-all-you-need-to-know/slidelist/114490954.cms">Afcons Infrastructure IPO – GMP, risk factors and all you need to know</a> <a href="https://www.businessinsider.in/tech/news/upi-refund-scam-to-digital-arrest-scam-here-are-most-common-online-scams-in-india/articleshow/114428011.cms">UPI refund to digital arrest scam, here are some online scams you need to be aware of</a> <a href="https://www.businessinsider.in/stock-market/news/waaree-energies-ipo-allotment-how-to-check-allotment-ipo-gmp-listing-date-and-more/articleshow/114508632.cms">Waaree Energies IPO allotment – How to check allotment, IPO GMP, listing date and more</a>

Stock market opens flat with a marginal decline, rangebound movement expected

The <keyword id="19925636" type="General" weightage="20" keywordseo="stock-market" source="keywords">stock market</keyword> closed in the red on Monday, with the <keyword id="19896382" type="General" weightage="20" keywordseo="Sensex" source="keywords">Sensex</keyword> falling by 73.48 points to settle at 81,151.27, while the <keyword id="19896381" type="General" weightage="20" keywordseo="Nifty" source="keywords">Nifty</keyword> declined by 72.95 points, ending at 24,781.10. Among Nifty-listed companies, 12 stocks recorded gains, while 37 ended the day in negative territory. <keyword id="19897354" type="General" weightage="20" keywordseo="Bajaj-Auto" source="keywords" meta.keywordsubtype="org" meta.entityname="Bajaj Auto" meta.hostid="261" meta.entityid="Bajaj Auto">Bajaj Auto</keyword>, <keyword id="19895995" type="General" weightage="20" keywordseo="HDFC-Bank" source="keywords" meta.keywordsubtype="org" meta.entityname="HDFC Bank" meta.hostid="261" meta.entityid="HDFC Bank">HDFC Bank</keyword>, Asian Paints, Mahindra &amp; Mahindra (M&amp;M), and Eicher Motors emerged as the top gainers, while Tata Consumer Products, Kotak Bank, Bajaj Finserv, Bharat Petroleum Corporation Limited (BPCL), and IndusInd Bank were the biggest losers of the session. Commenting on the market trend, V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said, "With the US markets setting new record highs, the global stock market rally appears intact. The steady decline in crude and stability in the US bond yields impart resilience to the stock market despite the lingering tensions in the Middle East." He further said, "The hope raised by the Chinese stimulus and the cheap valuations of Chinese stocks have the potential to sustain the 'Sell India, Buy China' tactical trade for some more time. This presents an opportunity for medium to long-term investors. Of the total FII AUM of $930 billion about 28% is <keyword id="19896150" type="General" weightage="20" keywordseo="financials" source="keywords">financials</keyword> which are facing the brunt of <keyword id="21360658" type="General" weightage="20" keywordseo="FII-selling" source="keywords">FII selling</keyword>. The sustained FII selling has rendered the valuations of financials attractive in an otherwise overvalued market." He noted that foreign institutional investors (FIIs) have been selling Indian financials, which make up about 28% of the total FII assets under management (AUM) of $930 billion. Looking ahead, <keyword id="19906087" type="General" weightage="20" keywordseo="Hyundai" source="keywords" meta.keywordsubtype="org" meta.entityname="Hyundai" meta.hostid="261" meta.entityid="Hyundai">Hyundai</keyword> India's market debut on Tuesday will be closely watched, following a modestly oversubscribed IPO last week. Investors are also awaiting the Reserve Bank of India's monetary policy meeting minutes on Wednesday and the HSBC Manufacturing, Services, and Composite PMI data on Thursday for fresh market cues. Shriram Subramanian, Founder and Managing Director of InGovern Research Services, remarked, "Markets are caught in indecision as bulls and bears battle it out. Mixed bag results from some index stock companies. HDFC Bank results were positive. The <keyword id="23629202" type="General" weightage="100" keywordseo="Hyundai-listing" source="keywords">Hyundai listing</keyword> on Tuesday will be keenly watched." As market participants navigate mixed signals from corporate earnings and global developments, the upcoming events are expected to provide crucial insights that could influence future market direction.

Stock market ends lower on Monday; Investors eye Hyundai listing and RBI minutes

The <keyword id="6422463" type="General" weightage="20" keywordseo="us-presidential-elections" source="Orion">US presidential elections</keyword> have always been a global spectacle, with both geopolitical and economic implications for almost the entire world. The primary uncertainty, as with any election, is who will win. But after the last election, when President <keyword id="19918985" type="General" weightage="100" keywordseo="donald-trump" source="keywords">Donald Trump</keyword> refused to concede in 2020, the suspense also involves whether the candidates will accept the verdict. Moreover, an added layer of uncertainty is the continued ambiguity over the specific policy measures that both Republican and Democratic candidates will take during the first few weeks. The result of all these uncertainties, along with the growing geopolitical conflicts and economic turbulences, is a <keyword id="6357440" type="General" weightage="20" keywordseo="stock-market" source="Orion">stock market</keyword> that’s wobbling beyond bounds. As investors flock to safer asset classes like gold and bonds, the Indian stock market has been on a downward spiral for over a month now, dropping almost 10% from its peak in late September. <h2>Sensex, Nifty tumbles on Monday</h2>On Monday, November 4, Indian stock markets continued to experience heightened volatility. The <keyword id="20783156" type="General" weightage="20" keywordseo="sensex-and-nifty" source="keywords">Sensex and Nifty</keyword> indices have each dropped by nearly 2% by noon, reflecting investor caution and aligning with recent market declines. On Monday morning, investors' wealth eroded by Rs 7.37 lakh crore as the equity markets fell sharply over 1000 points. “As October concluded, it marked a challenging month for bulls, erasing gains accumulated over the past two months, with Nifty dropping more than 6% one of the steepest monthly declines in recent times, which has impacted the monthly chart's structure… a breach below this week's support range of 24100–24000 could trigger further weakness, possibly pulling prices toward the 200 SMA near 23500,” says Sameet Chavan, Head Research, Technical and Derivative - Angel One. The turbulence is mirrored across major sectors, with substantial drops in IT, pharma, and financial stocks. High-profile stocks such as Reliance Industries, Hero Motorcorp, Coal India, ONGC and Tata Motors are all facing significant declines, with all these stocks down over 3%. Additionally, the Indian rupee has weakened to record lows, and government bond yields have risen, indicating investors are positioning for an extended period of uncertainty. The heightened volatility, alongside the U.S. election dynamics, is creating both caution and opportunities for Indian traders. With high demand for safer assets, this period could offer gains for those correctly positioned, but for the broader market, these fluctuations highlight the risks tied to global dependencies and the complex U.S.-India economic linkages. <h2>What should retail investors do?</h2>While the Sensex has seen a 7% dip from recent highs, the rupee has touched a historic low, and government bond yields are up by 14 basis points. The experts recommendations are also varying on what the investors should do at this crucial juncture. Given the growing uncertainties, retail investors should wait before deploying more capital, focusing on high-quality stocks and avoiding frothy small and midcap stocks that may carry heightened risks in the current environment, says the market expert Vijay Chopra. "Retail investors can look into buying shares of good companies where valuations are reasonable. This market correction is a good opportunity to buy as India's growth path is intact," says Shriram Subramanian, Founder and MD, InGovern Research Services. Overall, Indian investors and market analysts recommend a cautious approach. While the U.S. election creates a unique atmosphere of uncertainty, sticking to core investment principles—like diversification and long-term planning—can provide a buffer against the volatility expected over the coming weeks. Indian investors are increasingly aware that while the U.S. election is a spectacle to follow, broader economic indicators and global trends will ultimately shape the markets more than any one election outcome. <h2>Expectations from the US presidential election 2024</h2> <div type="image" title="Donald Trump vs Kamala Harris" agency="ETMarkets.com" msid="114938964" hostid="261" caption="&amp;lt;p&amp;gt;Representational image&amp;lt;/p&amp;gt;"></div> As the U.S. prepares for its 2024 presidential election, the Indian markets are not immune to the volatility. With Vice President <keyword id="20307089" type="General" weightage="20" keywordseo="kamala-harris" source="keywords">Kamala Harris</keyword> and former President Donald Trump in a tight race, stakes are high even for the Indian retail investors. The next U.S. administration’s policies could ripple through global markets, including India’s. As per the experts, three primary issues in the U.S. election — tariffs, immigration, and taxation — could directly affect the Indian economy and investor sentiment, according to an analysis from <a href="https://economictimes.indiatimes.com/prime/economy-and-policy/trump-will-tower-over-the-markets-this-week/primearticleshow/114931074.cms">The Economic Times</a>. Trump’s administration has historically used tariffs to curtail China’s manufacturing dominance, and if he wins, a continuation or even expansion of these tariffs could push inflation up. The ripple effect could push costs of imports and exports higher across emerging markets like India, affecting key sectors that trade with the US like IT, industrials, and manufacturing sectors. In terms of immigration, a potential Trump victory could bring renewed scrutiny on H-1B visas, which are crucial for India’s tech sector as nearly 75% of these visas go to Indian workers. On the other hand, a Harris administration is likely to adopt a more lenient approach, but specifics would depend on Congress. Regarding taxation, Trump’s policies are often seen as pro-business, but Harris has proposed tax reforms aimed at higher corporate taxes, which could lower S&amp;P 500 earnings by as much as 5.5%. The central role of the US dollar and investments in the global economy means that any volatility in American markets often has a cascading effect on emerging markets. As it stands, uncertainty has already driven the CBOE Volatility Index (VIX) higher, commonly referred to as Wall Street’s “fear gauge,” reflecting increased anxiety among global investors. For Indian markets, this could mean a series of short-term fluctuations, but a steady, diversified approach remains essential. History shows that while elections create immediate market ripples, longer-term impacts are typically moderate. (With inputs from agencies) Disclaimer: The content on this website is for informational purposes only and should not be construed as investment advice. We recommend readers consult certified, qualified and registered advisors for professional and personalised financial advice.

Indian stock markets wobble as uncertainty builds around the U.S. election this week. What should investors do?

<ul><li><keyword id="6418655" type="General" weightage="20" keywordseo="minority-shareholders" source="Orion">Minority shareholders</keyword> can do little to protect their investments in case of boardroom and family battles of promoters, say experts.</li><li>Shareholders should take a call to sell or stay invested based on how the company is performing.</li><li>Any legal recourse by minority shareholders can lead to further dilution of stock value, warn lawyers. </li></ul>The Raymond family drama has taken its toll on minority shareholders of the company because this category of investors is the most vulnerable. The stock has fallen by over 17% ever since <keyword id="6405378" type="General" weightage="20" keywordseo="gautam-singhania" source="Orion">Gautam Singhania</keyword>’s wife <keyword id="305817" type="General" weightage="20" keywordseo="nawaz-modi" source="Orion">Nawaz Modi</keyword> publicly accused him of assault. His letter to the board assuring smooth functioning of Raymond, has done little to calm the storm. This is not the only case where minority shareholders, who hold less than 50% of the stock, are affected by feuds between board and family members. There are two other ongoing cases of family members sparring over control of companies — pharma company Hikal and Finolex Cables. In these cases, there is very little that shareholders can do, say experts. They’re left between the choice of offloading stock as it’s falling or holding it for an indefinite period. In these cases, should shareholders sell or stay? “There is no easy way to answer this,” says Deepak Jasani, head of retail research at HDFC Securities. “It all depends on if the company is continuing to do well. They have to decide based on if the dispute can have a quick resolution or will be prolonged,” he adds. Delhi-based corporate lawyer Anuroop Omkar, founding partner of law firm AK &amp; Partners says that minority shareholders are very low in the pecking order when it comes to their ability to act. “Even in an insolvency, they’re below secured creditors,” he says. There is a provision in the Company Act 2013 called ‘Oppression and mismanagement in a company’ which protects minority rights. Mismanagement can be defined as conducting company affairs in a prejudicial, dishonest or inept manner. “But this can’t be invoked in the Raymond case, as it’s a personal battle,” he adds. Top corporate battles that affected shareholder value <table style="border-width: initial; border-style: none;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Feud </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Year </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Effect </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Family dispute between Mukesh Ambani &amp; Anil Ambani </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2004 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Culminated into a split of the company &amp; a court battle over natural gas sales later </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Dispute between promoter Narayana Murthy &amp; Vishal Sikka, the CEO over functioning of the company </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2017 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Sikka quit the company </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Family members Sungandha Hiremath and Baba Kalyani battle over Hikal </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2023 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">The case over family arrangement made in 1994 is being heard in Bombay High Court </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Cousins Prakash and Deepak Chhabria battle over control of Finolex </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2016 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">The case is with courts and National Company Law Appellate Tribunal (NCLAT) </td></tr></tbody></table> Between stock &amp; a hard place There is no third option for shareholders, even if they lose faith in the promoters’ ability to conduct business. They can only wait and watch, experts say. “Minority shareholders will have to rely on the Board and independent directors to act on their behalf,” Shriram Subramanian, founder &amp; MD of proxy advisory firm InGovern tells Business Insider India. In Raymond’s case, the board of directors can investigate based on allegations made by Modi that company funds have been misused. “The Board has to ringfence the company from utilization of funds by Gautam Singhania for any personal legal matters,” adds Subramanian. Institutional advisory firm IiAS also wrote an open letter seeking independent investigation by the board, asking them to send promoters on leave till investigation is complete. “Independent directors have a fiduciary responsibility towards minority investors, employees and a larger set of the company’s stakeholders. Therefore, you will need to dispassionately separate ownership from management,” IiAS’ letter says. Legal recourse: A double-edged sword There is, however, a way for minority shareholders to edge into the board, with the help of courts. “If there is a case of harassment or erratic behaviour, many entities related to the company like vendors, employees can file a class-action lawsuit wherein shareholders can join in too. But it doesn’t happen too often in India,” says Omakar. Only Foreign Institutional Investors (FII) who have over 1% stake in the company or a high-networth individual (HNI) who can afford to take up such long-standing fights. Subramanian believes that fighting for rights comes at a cost for minority shareholders. Also, the rights need to be exercised with responsibility. Minority shareholders, depending on their shareholding, can exert their rights to bring about change in the company, including change of directors, appointment of new directors, etc. Legal recourse can also work against the long-term interests of shareholders too. “There can be a major share price drop if a legal battle is taken up,” says Omkar. That can go against the interests of shareholders who want to protect the value of their investments. Until then, stock experts advise shareholders to read up on the corporate governance track record of companies and take a call on whether they want to hold on or sell out from a company engaged in a battle of its own. SEE ALSO <a href="https://www.businessinsider.in/finance/news/rbi-governor-asks-realty-companies-to-stress-test-their-books/articleshow/105411235.cms">RBI governor asks realty companies to stress test their books</a> <a href="https://www.businessinsider.in/policy/economy/news/rupee-hits-a-new-low-in-november-despite-fall-in-dollar-index/articleshow/105551439.cms">Rupee hits a new low in November despite fall in dollar index</a>

Minority shareholders must grin and bear it when promoters wash dirty laundry in public

New Delhi, Jan 10 () Shareholder proxy advisory firm InGovern has petitioned Sebi to force promoters of Sterling and Wilson Solar Ltd to provide an exit offer to minority shareholders alleging failure of promoters to keep the promise made in the IPO document.
 Sterling and Wilson Solar Ltd got listed on the BSE and the NSE on August 20, 2019, after promoters belonging to the Shapoorji Pallonji Group made an offer for sale of shares.
 "The offer for sale of shares resulted in promoters raising Rs 2,850 crore through the IPO," InGovern Research Services said in a report. "While the objects of the IPO were to enable the promoters to repay loans amounting to Rs 2,563 crore to SWSOLAR within 90 days of listing, the company has received only Rs 1,000 crore on December 31, 2019, i.e., 133 days after listing."
 This non-fulfilment of obligations by the promoters as per the objects of the offer has resulted in a loss of over 60 per cent in investment value for IPO investors as stock price has fallen from the issue price of Rs 780 to Rs 310, resulting in a loss of Rs 1,700 crore for public minority shareholders, it alleged.
 Sterling and Wilson Solar hit back at the proxy advisory firm contending that the report is "malicious, misleading, defamatory" and contains "factually incorrect and unverified statements".
 "The author of the report has acted irresponsibly as he has neither found it appropriate to ascertain the facts nor provide us with a draft of the report for our response. This appears an attempt to malign the reputation of the promoters using the media," the company said adding the objects of the IPO was to provide liquidity to the shareholders.
 "The utilisation of the proceeds was an added intent of the promoters and cannot be directly construed to be the object of the offer. The Promoters would like to state that this intent is intact and is suitably demonstrated by facilitating repayment of Rs 1000 crore as committed by December 31, 2019," it said.
 InGovern said the non-utilisation of the IPO proceeds for the stated purpose was tantamount to change of objects of the IPO from what was stated in the prospectus. "This has resulted in aggrieved minority public shareholders."
 It said the SEBI (ICDR) Regulations, 2018, allow for the dissenting shareholders to be provided an exit offer by the promoters, in cases where there is a change in objects of the issue/ offer in the IPO prospectus. In this case, where shareholders have suffered significant erosion in the value of their holdings solely due to the non-utilisation of funds as per the objects of offer of the IPO, Sebi must force the promoters to provide an exit offer to shareholders at a price as per SEBI (ICDR) Regulations, it said.
 Shriram Subramanian, founder and MD of InGovern, said, "Overall, a huge loss of reputation for the promoters of the SWSOLAR, the SP group. With substantial -- over Rs 1,700 crore -- erosion of wealth of public minority shareholders, and loss of investor trust for a group that seemed to have a stellar reputation. In order to redeem this reputation, the SP group should provide an exit option for public minority shareholders. This is a demand from minority shareholders and Sebi should force the promoters to provide an exit option for minority public shareholders."
 The company however denied any wrongdoing. "Being an offer for sale (OFS), the promoters were under no obligation to mention the utilisation of proceeds. In fact, the promoters made this disclosure in good faith even though it was not required by law. There is thus no legal default as is being sought to be made out."
 It went on to deny the allegation of being uncooperative with credit rating agency ICRA saying Sterling and Wilson Pvt Ltd is no longer rated by ICRA for the last few years. "ICRA was unable to withdraw its earlier rating due to its requirement to have an NOC from each and every consortium banker. This matter took time and has now been completely resolved and ICRA has withdrawn its rating of SWPL on January 6, 2020."
 India Ratings is the agency which does the rating of SWPL and in its report, there is no such comment of 'non-cooperation', it said.
 The company said the board of directors while approving the repayment schedule levied additional interest of 100 basis points and there is no financial loss to Sterling and Wilson Solar Ltd on account of reschedulement and "it is illogical to link the stock price reduction to this aspect."
 "The sensationalism in this report is more an attempt to further erode investor wealth rather than its stated objective of working in the interests of the investors," it added. RKL ANZ HRS

Sterling and Wilson promoters must provide exit option to minority shareholders:  InGovern

A year ago, when <keyword id="6354512" type="CITY" weightage="100" keywordseo="Infosys">Infosys</keyword> brought back iconic co-founder <keyword id="51793" type="ORGANIZATION" weightage="100" keywordseo="NR-Narayana-Murthy">NR Narayana Murthy</keyword> as executive chairman, about two years after his retirement, in a bid to revive the sagging fortunes of the $8.2-billion <keyword id="2283995" type="UNKNOWN" weightage="100" keywordseo="IT-behemoth">IT behemoth</keyword>, the decision was welcomed with much fanfare. 
 <keyword id="6359051" type="COMPANY" weightage="100" keywordseo="investors">Investors</keyword>, who showed confidence when Murthy announced a three-year turnaround plan, are worried today. In the months following Murthy's return, Infosys saw exits of some of its top executives. Among others, the company saw resignations of board members <keyword id="376348" type="PERSON" weightage="80" keywordseo="Ashok-Vemuri">Ashok Vemuri</keyword>, V Balakrishnan and, more recently, <keyword id="675707" type="ORGANIZATION" weightage="100" keywordseo="BG-Srinivas">BG Srinivas</keyword>. 
 
The three were once seen as top contenders to become the CEO of Infosys after incumbent SD Shibulal’s retirement by January next year. These exits, analysts believe, affected Infosys’ business. SD Shibulal, the chief executive officer and managing director of Infosys, will step down by January next year. 
 
Anil Singhvi, a Shareholder activist, said BG Srinivas' exit had jolted investors. Srinivas, the latest to exit, was president of the company and a man who many saw as the leading contender for the CEO position. 
 
"Whatever Murthy may say in his letters (assuring employees and investors), there is much to be desired in Infosys. In the last three to four months, the company's stock price has dropped from the Rs 3,500 levels to Rs 2,900. The way the markets have been reacting to the Modi factor, one should have seen the Infosys stock price at the Rs 4,000 level," Singhvi said. 
 
He said the genesis of what's happening now is the re-entry of Murthy. "Bringing his son along with him was Murthy's biggest mistake. Many investors at that time were apprehensive but didn't speak out. People in the management who were in the company for 10 to 15 years have quit. At the end of the day, what is the difference between the Gandhi family and the promoters of Infosys? How long do the promoters want to sit at the helm of the company?" he asked. 
 
Shriram Subramanian, founder and MD of independent proxy advisory and governance research firm InGovern, said the departure of several top executives, especially during the CEO selection process, was a concern. 
 
Investors are worried about leadership development and succession planning, he said, and added that several FIIs and one large Indian institutional investor, who he declined to name, had raised concerns about the CEO selection process. 
 
Subramanian also said the promoters should opt out of executive and non-executive roles and should not even be on the board. Such a step will at least make the company a truly widely-held company with no promoter on its board, he added. 
 
Infosys is one of the few, if not the only Indian listed company, where FIIs hold a 42.1% stake and domestic institutional investors hold 13.66% stake. The promoter group holds only 15.94% and retail investors hold 28.3%. 
The Annual General Meeting of Infosys, which is scheduled to be held on June 14, will reveal whether the management will say anything about these concerns of the investors.

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