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ITC board meet today amid void

The company has not yet informed the bourses whether it would discuss ways to fill the void left by Deveshwar

  • Published 13.05.19, 12:04 AM
  • Updated 13.05.19, 12:04 AM
  • 2 mins read
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From 1996 to February 5, 2017, Deveshwar was the executive chairman of ITC. Telegraph file picture

The ITC board will meet on Monday for the first time in a quarter of a century without the looming presence of Yogesh Chander Deveshwar at its helm.

The apex body of the conglomerate is scheduled to take up the fourth quarter and annual results and the declaration of dividend, among other issues, in the meeting, two days after the death of its longest-serving chairman.

The company has not yet informed the bourses whether it would discuss ways to fill the void left by Deveshwar, who had an unbroken stint on the board from 1994.

From 1996 to February 5, 2017, Deveshwar was the executive chairman of the company. After slipping into the role of the non-executive chairman, the post of chief executive officer was created to elevate Sanjiv Puri, who was a wholetime director till then.

Puri was made managing director of ITC, effective May 16, 2018. He was vested with the responsibility to run the sprawl of businesses — tobacco, FMCG, hotel, paper and paperboard and agri. He is aided by three executive directors — Nakul Anand, B. Sumant and Rajiv Tandon — on the board.

The market will be keenly watching if the company makes any formal announcement on who would be the new chairman of ITC and if the role is going to be a non-executive one.

The impact on the stock will also be watched as investors appeared to have unflinching confidence in the leadership of Deveshwar, during whose term shareholders were handsomely rewarded by way of multiple bonus issues, dividends and capital appreciation. In two decades of his executive role, ITC’s revenue went up 10 times and profit before tax grew 33 times.

British American Tobacco, the London-based giant, is the largest shareholder on the board of ITC.

However, it has just one nominee on the board, which has 10 non-executive members. Before Deveshwar took over as the chairman, BAT was angling for a more active role in the company rather than a passive dividend earning shareholder.

The Life Insurance Corporation of India and Specified Undertaking of the Unit Trust of India (SUUTI) are the two other large shareholders of ITC, which does not have an identified promoter group, just as engineering giant Larsen & Toubro.

The voices of LIC and SUUTI, often considered by market participants as the proxy of the government of the day at the Centre, will also be crucial in the days ahead on the leadership question.