Billionaire Vijay Mallya-led UB Group, currently in the eye of a storm over troubles at its Kingfisher Airlines, has lost nearly half of its market value from its peak scaled in the past one year.
As per the stock exchange data, the combined market value of the group's six listed firms -- Kingfisher, UB Holdings, United Breweries (UBL), United Spirits (USL), Mangalore Chemicals and Fertilizers (MCFL), and UB Engineering (UBEL) -- currently stands at about Rs 22,850 crore.
This marks a fall of about Rs 21,800 crore ($4.4 billion) from the total market value of these six at their peaks in the past one year.
Out of this collective loss, the promoter holdings in the six companies account for more than half at about Rs 11,500 crore, while the remainder has been in the portfolio of other shareholders including banks, retail and other investors.
Adding to the group's troubles in the market, promoters have heavily pledged shares in most of its listed companies, including Kingfisher, the stock exchange data showed.
As per the latest shareholding patterns available till the end of July-September 2011 quarter, the total shares pledged by the promoters is worth over Rs 4,000 crore, but the actual value at which these shares were pledged could be much higher as the stocks have fallen sharply in recent past.
While queries sent to a group spokesperson regarding the various aspects of the shares pledged by promoters remained unanswered, the shareholding patterns filed with the stock exchanges show that the promoters pledged further shares in three group companies during the July-September 2011 quarter.
The total shares pledged by the promoters during the latest quarter are worth over Rs 100 crore at current prices.
The companies where promoters pledged more shares in the last quarter included USL, MCFL and UBEL.
However, the level of shares pledged by the promoters in three other companies -- Kingfisher, UB Holdings and UBL -- remained unchanged during the period.
The group is currently facing troubled times with regard to its aviation venture Kingfisher, which has cancelled a number of flights due to factors like increased costs.
The airline has said that it has requested banks for a higher borrowing limit due to rising operating, costs caused by costlier fuel prices and rupee devaluation.
The airline had effected a loan recast earlier this year, wherein some banks were given certain equity stakes, but its debts are still estimated to be about Rs 7,000 crore.
As per the airline's shareholding pattern as on September 30, 2011, the promoters have pledged 90.17% of their holding. These shares are currently worth over Rs 500 crore.
The queries remained unanswered on whether the group plans to pledge further shares in various companies to garner funds for Kingfisher, neither there were any replies to questions on any roadmap for releasing the pledged shares.
In UB Holdings, promoters have pledged 15.29% of their holding (about Rs 50 crore), while they had pledged 9.13% (currently worth Rs 670 crore) of their stake in UBL.
The promoters did not pledge fresh shares in these three companies during the quarter.
However, the percentage of pledged promoter holding increased at USL (from 87.72% to 89.64), MCFL (from 63.72% to 88.67%) and UBEL (from 17.57% to 96.67%) during July-September quarter.
The pledged shares in USL are worth about Rs 2,750 crore, while shares worth about Rs 100 crore and about Rs 30 crore are pledged in MCFL and UBEL, respectively.
Promoters hold 58.61% stake in Kingfisher, 51.5% in UB Holdings, 74.05% in UBL, 28.01% in USL, 30.44% in MCFL and 40.74% in UBEL.
At the current valuations, the promoter holdings in these companies are worth about Rs 12,800 crore -- down from Rs 24,300 crore at the peak market value of these companies in the past one year.
Five out of these six companies scaled their peak value almost a year ago in early November 2010, while one, UBL, was at its one-year high in June this year.
Kingfisher's market value has plunged to below Rs 1,000 crore now, from about Rs 4,500 crore a year ago, while the losses are in the range of 30-75% for others.
As against their current combined market value of about Rs 22,800 crore, the six companies had total revenue of about Rs 20,000 crore in the last fiscal -- up from about Rs 15,000 crore in the previous year.
Except Kingfisher, all the companies had posted net profit in the last fiscal, but the combined value turned negative due to the airline's net loss of over Rs 1,000 crore.
But, their collective loss figure declined to about Rs 300 crore in FY11, from about Rs 1,000 crore in the previous year.
The market value loss also reflects in the networth of the group chief Vijay Mallya, who was ranked as 49th richest person in India with $1.1 billion of wealth in the Forbes magazine's annual rich list for 2011.
His position has fallen from 44th on the Forbes list for 2010, when his networth was put at $1.45 billion.
Mallya has been moving up and down on the list for five years now. He was ranked 40th with $1.6 billion in 2007, then fell out of the list in 2008 with just $390 million of networth, and again entered the annual rankings in 2009 at 60th position with $900 million.
