In an exclusive interview with FE, AV Birla Group chairman Kumar Mangalam Birla said: I think we are clearly looking at increasing our holding across group companies by the normal creeping acquisition route that we are allowed to do by the Securities and Exchange Board of India (Sebi). That is something we are looking to do on a constant basis.
While Mr Birla said that it was difficult to give a promoter shareholding which the group would be comfortable with, he added that 30 per cent would be a ballpark figure.
While the promoter holding in Grasim stands at 21.94 per cent, Hindalco has a group holding which stands at 24.37 per cent. The promoter shareholding in Indian Rayon and Indo Gulf stands relatively higher at 28.57 per cent and 37.77 per cent, respectively.
The Birlas are also clear that cross-holding across the group companies would not be increased any further. We are very clear on cross-holding. About nine years ago, we said that we will reduce our cross-holding and stuck to that commitment, according to Mr Birla.
He admitted that the group had not been able to untangle all cross-holdings as it had been created over a long period of time. Some amount of untangling has been done in the case of IndoGulf and BGFL.
Hindalco has 2.51 per cent stake in Grasim, while Grasim and Indian Rayon in turn hold stakes in Hindalco. Grasim has a 12.27 per cent stake in Indo Gulf while Indian Rayon and Hindalco have substantial holdings over 8 per cent in the company.