Godfrey Phillips India fell 5.57% to Rs 1296.30, extending yesterday's 4.59% slide amid concerns related to alleged corporate governance and disclosure violations.
Jupiter Asset Management (Jupiter), which holds 9.37% in Godfrey Phillips India (GPI), on 7 January 2020, raised concerns over the company's corporate governance standards. Jupiter said that it has previously raised the "broader question of the group's corporate governance" with the company. "It is clear to us that a review of the group's governance would be beneficial, Jupiter said.One of trustees of KK Modi Family Trust, Lalit Kumar Modi shared the letter on Twitter on 28 January.
GPI on Tuesday clarified that its promoter KK Modi-owned Modi Enterprises has no plan to sell its stake in the cigarette maker. The company also clarified that it is neither engaged nor privy to any such discussions on rumored potential transaction by its promoters".
The clarification came after Lalit Modi, son of late industrialist KK Modi, said on Twitter that all assets of the group were up for sale. "Just to set the record straight Yes, all assets of the KK Modi group are going on sale. I mean all. The other three trustees wanted to continue running the business but I felt post my father passing away - the value will deplete. I voted for sale," Modi tweeted late on 27 January.
GPI also clarified that it received a clarification from its "significant promoter" that there has been no decision to put the company's assets on sale.
However, Modi reiterated on Twitter that he decided to sell all the family-owned assets in their entirety.
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Lalit Modi and his family own 47.09% stake in GPI, while Philip Morris Global Brands, the owner of the Marlboro brand, own 25.1%.
On a consolidated basis, net profit of Godfrey Phillips India rose 56.23% to Rs 113.53 crore on 12.67% rise in net sales to Rs 709.40 crore in Q2 September 2019 over Q2 September 2018.
Godfrey Phillips India, flagship company of Modi Enterprises, makes some of the most popular cigarette brands in the country like Four Square, Red and White, Cavanders, Tipper and North Pole. Godfrey Phillips India also manufactures and distributes iconic brand Marlboro under a license agreement with Philip Morris.
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