Reliance Industries and its wholly-owned subsidiary, Reliance Industrial Investments and Holdings Ltd (RIHL), have reduced their holdings in Larsen & Toubro by 1.34 per cent, or 3,330,464 equity shares.
The combined holding of the two companies have been reduced from 6.01 per cent in 1998-99 to 4.67 per cent in 1999-2000.
This does not include the holdings of another group company, Reliance Capital, which has not yet issued its annual report.
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As of March, Reliance Industries held 952,347 equity shares of L&T against 17,82,347 shares during the same period previous year, while RIHL holds nearly 10,663,308 shares against 13,163,772 shares previous year.
Reliance Capital held 2,179,000 shares, taking the group's total stake in L&T to 11 per cent, or 14,946,119 shares, at the end of 1999-2000.
Around 2 per cent, or 50 lakh, shares of L&T has been pledged as security for an open offer for a 20 per cent stake in the power major BSES. The value of the shares, while pledging, was estimated at Rs 92 crore. According to the current market price, the total worth of the combined holding of RIL and RIHL is valued at Rs 201 crore. L&T's total subscribed paid-up share capital is Rs 248.52 crore.
The sluggish growth in the capital goods industry and the lower cement price realisation resulted in a 27 per cent drop in L&T's net profit to Rs 342 crore in 1999-2000. Its turnover growth was a little over 2 per cent to Rs 7,424 crore. The Reliance group has always maintained that the stake held by the group in L&T is only of a strategic investor. The group is represented on the company's board by RIL vice-chairman Mukesh Ambani and managing director Anil Ambani.