Grasim Industries to raise foreign investment limit to 30%

The Dollar Business Bureau 

Grasim Industries Ltd, an arm of Aditya-Birla group, has decided to increase the foreign investment limit from the currently approved 24 percent to 30 percent, according to a statement issued by the company.

The decision, taken by the shareholders, will put into effect an stated increase in the investment limit for Registered Foreign Portfolio Investors (RFPIs)/Foreign Institutional Investors (FIIs) of the company’s equity share capital.  The rise will come into effect after due approval from the Reserve Bank of India (RBI).

The change has been brought about to further aid investments by the RFPIs/FIIs into the company’s equity shares. This headroom for increase will be augmented following the merger of Aditya Birla Nuvo Ltd (ABNL) with Grasim Industries, considering the level of holding of FIIs/RFPIs in ABNL at 12.1 percent as of June 2016.

The expected merger will see the creation of Aditya Birla Group’s financial services business into a separate entity for which the requisite regulatory approvals are underway. The merger will take place in two phases with the branched-off firm being listed later.

The merger will initially combine ABNL with Grasim followed by the demerger of the financial services business.

The statement also reflected upon the sub-division of Grasim’s equity shares from one equity share of a face value of Rs.10 each fully paid up to five equity shares of a face value of Rs.2 each fully paid up, with effect from October 6, 2016. The steps are directed towards enhancing the liquidity of the company’s equity shares.