Baba Kalyani's son seeks Hikal board seat again, faces possible opposition from aunt: Report

Baba Kalyani’s son’s reappointment ensures that the Kalyanis retain board representation in line with their ownership

The longstanding ownership tensions between Bharat Forge chairman and MD Baba Kalyani and his sister, Hikal non-executive director Sugandha Hiremath, have taken another turn. Baba's son, Amit Kalyani, is seeking re-election to Hikal's board as a non-executive, non-independent director, a Times of India report said on Monday. His reappointment, which requires a majority vote under an ordinary resolution, could face resistance from his aunt, the report added.

Amit, 50, has been serving on Hikal's board for 13 years. Sugandha and her family, who hold roughly 35% of Hikal, are reportedly expected to oppose his reappointment, the TOI report added. In December 2023, Baba Kalyani stepped down from the Hikal board after failing to garner sufficient shareholder support, ending a 31-year tenure. Sugandha's camp had voted against his reappointment at that time.

Remote e-voting for Amit's reappointment will close on Monday, with the results expected on Tuesday after the AGM concludes. Baba and his family, holding 34% of Hikal, are anticipated to support their son, while the remaining 31% of shares are held by non-promoter shareholders. Observers are closely watching how institutional and retail investors will vote on Amit's directorship.

In September 2024, Sugandha secured her board position with backing from institutional and retail shareholders, despite opposition from Baba and his family. Shareholder advisory firms are split on Amit's candidacy: SES has recommended voting in his favour, whereas IIAS has advised against it. IIAS commented, "We note that the promoters (Hiremath and Kalyani factions) are involved in a dispute regarding Hikal's ownership. We expect them to relinquish their board positions, resolve the ownership dispute, and then seek reappointments to protect the overall functioning of the company and safeguard shareholder interests from a prolonged promoter conflict."

Meanwhile, Kalyani rebutted IIAS recommendation, saying "We clarify that the said dispute pertains to seeking specific performance of a purported family arrangement of 1994 between two Promoter groups. Amit Kalyani is not a signatory or a party to such purported family arrangement. Amit Kalyani has been made a party to the said Dispute solely in capacity as Chairman of (a) Kalyani Investment Company Limited and (b) BF Investment Limited; and Director of Hikal."

“No reliefs are sought against Mr Amit Kalyani. No orders have been passed in the said Dispute and there is no next date of listing reflecting on the court’s portal as well,” it added.

Amit recently resigned from his role as an independent director on Schaeffler India's board, citing "other professional commitments." Apart from Hikal, he also serves on the boards of Bharat Forge, Kalyani Steels, and three other companies. SES noted, "Although Amit now holds six listed directorships, since they are all within the common promoter group, we do not have major concerns regarding his time commitments."

Hikal's origins trace back to Sugandha's husband, Jaidev Hiremath, who set up a manufacturing facility in Maharashtra with seed funding that came from Baba Kalyani’s father. Shares were initially issued to Surajmukhi, an entity owned by their father, with the understanding they would be transferred back to the Hiremath family. Sugandha claims Baba did not honour this arrangement, retaining his 34% stake in Hikal, and has approached the Bombay High Court, which is set to hear the matter in October. Baba, however, has dismissed the share-transfer clause.