Friday, April 17, 2015

Corporate Governance - A Case of S Kumars Nationwide Limited

As reported in Business Standard and other business news papers, some shareholders of S Kumars Nationwide Limited (SKNL) have convened an Extra Ordinary General Meeting to remove Mr. Nitin S Kasliwal the CMD and the whole Board. Mr. Nitin S Kasliwal at present holds only 3.59 per cent stake in the company. The stake has been reduced due to redemption of shares pledged by promoters. The company has fallen in bad times because of over ambition of the promoters.

I tried to look into the the constitution of the board of directors. I found that the web site is not updated. Money and Control shows the updated information on the constitution of the Board. The Board does not have any independent director. Therefore, none can expect the the Board to be independent. This is gross violation of SEBI Corporate Governace Code and the requirements of Companies Act 2013. The web site shows that the last annual report presented by the company is that of 2012-13. Perhaps, the company failed to present annual report for the year 2013-14. Even quarterly financial results for 2013-14 are not available on the web site.

This is an example of a listed company the promoters of which do not care for good governance and  do not believe that they are accountable to shareholders who are part owners of the company and with whose money they build the empire.

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