Baba Kalyani stays as Bharat Forge MD despite opposition of institutions

Baba Kalyani will stay on as Bharat Forge's MD

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The resolution to reappoint BN (Baba) Kalyani as Bharat Forge managing director has not gone down well with a majority of the company's institutional shareholders as they voted against it.

According to voting results published on the BSE, about 53.51 percent of institutional investors voted against the resolution last week, while the rest 46.49 percent supported Kalyani's reappointment.

However, he will continue as managing director as the special resolution went in his favour, thanks to the dominant promoter group vote. Promoters hold 45.25 percent stake in Bharat Forge.

Among the promoter and promoter group votes, 75.45 percent went in favour of the proposal, while 24.55 percent went against it, as per the exchange filing.

According to an Economic Times report, proxy advisory firms such as Institutional Investors Advisory Services (IiAS) and Stakeholders Empowerment Services (SES) had recommended investors vote against the special resolution to appoint Kalyani as the MD citing excess remuneration. His total salary package in FY23 was around Rs 21.26 crore.

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For the quarter ended March 2023, the auto component and construction company reported a fall of 7 percent in standalone net profit at Rs 245 crore, compared to Rs 262 crore in the year-ago period. Its revenue from core operations jumped 19.3 percent to Rs 1,997 crore from Rs 1,674 crore in Q4 FY22.

According to Kalyani, defence will be the major revenue driver in coming years. "Defence will contribute 10 percent to revenues in FY24 versus 2 percent in FY23. It will contribute 20 percent to the topline by FY26," he had said in an interaction with CNBC-TV18 earlier.

In other news, the 74-year-old Kalyani is also caught in a court battle with his sister Sugandha Hiremath over ownership of Hikal, based on a 30-year-old family settlement.

At 3pm on June 6, shares of Bharat Forge were trading flat at Rs 800.05 on the NSE.