Singh brothers' stake halves to 25.3% in Religare Enterprises

Dhillon family holding also down to 2%; Invocation of pledged shares and market sales by lenders seems

The shareholding of the promoters of financial services firm Religare Enterprises has halved to 25.33 per cent in the last quarter. The fall in holding of billionaire brothers Malvinder Mohan Singh and Shivinder Mohan Singh and entities they control, reported to the exchanges in the latest shareholding pattern as of September 30, has come amid several attempts by their Japanese adversary Daiichi Sankyo, which has moved courts, to block the sale of brothers' assets. Sankyo has been seeking to enforce an arbitral award relating to its acquisition of Ranbaxy holdings, almost a decade ago.

All four promoter entities, which held big chunks in Religare, saw their holdings fall. Malvinder now holds 3.6 per cent against 6.23 per cent earlier, while the younger brother's stake fell to 1.5 per cent, a fourth of his previous holding. RHC Finance emerged as the largest promoter entity with a holding of 12.2 per cent (down from 16.31 per cent). RHC Holding, which was earlier the main holding firm with 22. 25 per cent stake, saw its holding shrink to 7.9 percent.

According to the filings, the holding of the entities of Dhillon family, related to the brothers, has also fallen significantly during the period. The holding of Shabnam Dhillon, the wife of Singh Brothers' spiritual guru Gurinder Singh Dhillon, fell from 8.5 per cent in June to 0.22 per cent. Bestest Developers, which had 4.8 per cent stake, did not report any holding, while SGGD Projects Development, another Dhillon group firm, reported 1.8 per cent holding against 4.2 per cent at the end of the previous quarter. In effect, the family holding fell to around 2.12 per cent from a significant 17.6 per cent three months ago.

A Religare spokesperson declined to offer any comment. Group sources said the Singh family continues to control the largest chunk of shares and are still firmly in control of the financial services firm. However, concerns over the financials and strictures from Reserve Bank of India (RBI) apart from the legal battle with Daiichi have led to flight of investors. The stock has lost over two thirds of its value in the last quarter, putting pressure on lenders to invoke the pledges. A significant portion of the promoter holding continues to remain pledged with lenders.

Bulk of the divested shares have gone to institutional holders. As of September, IDBI trusteeship services owns 17.1 per cent in Religare, followed by 8.9 per cent by Axis Bank. Dilip Kumar Lakhi, a high net worth individual, with several mid cap holdings has also picked up a three per cent stake. None of the three had any mentionable holding in June. Holding by retail investors (6.9 per cent) and bodies corporate (28.9 per cent) have also seen significant jumps.

In July, Business Standard had reported a similar steep fall in promoter holdings of Fortis Healthcare, the hospital chain controlled by brothers. In August, the apex court had refused permission to the brothers to sell shares in Fortis Healthcare. While in Fortis, the promoters hold around 34 per cent now, the holding in Religare is just enough to ward of special resolutions, which need a three-fourth majority.