Bilt seeks nod to double FII ceiling

Ballarpur Industries Ltd (Bilt), the flagship of Lalit Mohan Thapar group, has sought shareholders' approval to more than double the 24 per cent foreign portfolio investment limit in the company.

Thapars are bringing a special resolution at the annual general meeting on December 15 to revise the limit to 49 per cent.

The combined foreign shareholding in Bilt has already crossed 24 per cent in September 2004.

Foreign investors now hold around 26.09 per cent in the company, which is one of the highest among family run Indian companies. It constitutes the second biggest chunk in Bilt after the promoters.

According to Sebi guidelines, the aggregate holding of all foreign institutional investors and their sub-accounts in an Indian company can be up to 24 per cent of the paid up capital.

This limit can be increased to the sectoral cap limit of 49 per cent if the shareholders passed that as a special resolution. Each individual FII could hold up to 10 pert cent in a company.

Describing the motive behind the proposal to increase the sectoral cap, a company official said the shareholding of FIIs and their sub-accounts has been increasing over the years.

"Due to the sectoral cap of 24 per cent, lot of FIIs have been forced to reduce their exposure to Bilt. So the company has decided to ease the cap," sources in the company said.

Interestingly, foreign shareholding in Bilt has gone down a little bit from 27.08 per cent in June 2004 to the present level of 26.09.

Promoters' stake has increased from from 37.03 per cent in June to 37.63 per cent in September.

L M Thapar group holds stake in Bilt through Bilt Paper Holdings Ltd and Karam Chand Thapar and Brothers.

Incidentally, Thapars have already decided to demerge KCTB in to seven outfits, so that each fraction of the group gets a separate holding company out of KCTB.

The major foreign investors in Bilt are Janus Capital, Copthall Mauritius Investment, T Rowe Price International, CIHL Pvt Equity Ltd, Deutsche Bank Trust and Starlight International Holdings.

Starlight Holds around 6.16 per cent in Bilt, followed by 5.85 per cent by Janus and 5.64 per cent by Deutsche Bank Trust.