Calcutta, Feb. 10: The Godrej group has increased its shareholding in two group concerns — Godrej Consumer Products and Geometric — over the last few months.
In December, the board of Godrej Consumer Products proposed to buy back up to 1.7 crore shares (of a total public shareholding of 7.89 crore) at a maximum price of Rs 150. The maximum amount earmarked was Rs 14.90 crore.
In Geometric, the groups investment arm Godrej Investments raised its holding by 3.99 per cent to 8.98 per cent till December from 4.99 per cent as on March 31, 2008 through creeping acquisition.
In the process, the promoter groups holding in Geometric went up to 35.23 per cent from 31.64 per cent in the corresponding previous period.
Godrej Consumer had mopped up Rs 396.45 crore from a rights issue in March last year. The company has till December used Rs 67.50 crore. The balance funds have been temporarily invested in fixed deposits, the companys auditors said.
Till December, the promoters holding in Godrej Consumer Products was 69.40 per cent, up from 67.81 per cent reported at the end of March 2008.
Meanwhile, in January, Godrej Industries pledged 1.95 crore equity shares in Godrej Consumer Products, or 7.78 per cent of its total paid-up capital.
As Godrej is not doing well in IT, promoters may have taken the creeping acquisition route to raise stake in Geometric, said equity analyst Arun Kejriwala. The consumer products business has shown good growth, he said.
Karvys Ambareesh Baliga said, Since Geometric was not doing well, buyback was not a preferable option.
However, Geometrics reserves stood at Rs 205.98 crore in March 2008 and it came down to Rs 201.38 crore by the end of December.
Godrej spokespersons refused to comment on the issue.
Last week, Geometric informed the bourses that the company board had approved consolidating its US investments into one single holding company.