IndusInd Bank invokes shares in Eveready, McLeod Russel; promoter share falls

IndusInd Bank has invoked pledged shares in Williamson Major group companies – acquiring 5,683,320 shares in Eveready Industries India and 7,832,253 shares in McLeod Russel India, thus reducing promoter shares in these firms.

"It is surprising that pledged shares are being invoked at a time when value is being created," sources told Business Standard, noting that the move may be led by “brightening prospects of debt resolution.”

With this, the private lender has acquired 7.82 percent and 7.50 percent shares in Eveready Industries and McLeod Russel, respectively. Promoter holding in both companies has consecutively fallen to around 7.25 percent and around 18.32 percent, respectively.

Also read: IndusInd Bank up 2%, Eveready hits 52-week high as bank acquires stake in battery maker

The shares in Eveready Industries and McLeod Russel were pledged against outstanding dues of holding company -- Seajuli Developers & Finance, which had raised most of the funds during the past year for McNally Bharat Engineering.

Promoter holding in Eveready Industries and McLeod Russel stood at 42 percent and 31 percent, respectively, till last year.

Prior to this, promoter share in Eveready Industries fell to 15.07 percent in July after the Burman family (Dabur India promoters), who have been buying into the company since March 2019, emerged as its largest shareholders with 19.84 percent stake. The last tranche acquired through open market operations was 8.48 percent and the stock has since risen over 80 percent since, it said.

India Ratings (Ind-Ra) earlier this month raised Eveready Industries’ long-term credit ratings from ‘IND BB’ to ‘IND BB+’ with a positive outlook, which it said reflected the company’s improved liquidity position and sustained profit in FY20. The positive outlook anticipates managerial or board representation from the Burman family, it added.