Entero Healthcare Solutions CEO, MD, chairman, board of directors and AGM

Mutual fund votes, meeting of 28 Aug 2024, 2 fund houses

Each resolution counts the houses whose vote was matched to it; the rest are listed last.

• To receive, consider and adopt: a. the audited standalone financial statements of the Company for the financial year ended 31st March, 2024 together with the reports of Board of Directors and the Auditors’ thereon; and b. the audited consolidated financial statements of the Company for the financial year ended 31st March, 2024 together with the report of the Auditors’ thereon.MoreLess

  1 for0 against
• To appoint a Director in place of Ms. Sumona Chakraborty (DIN: 09597426), who retires by rotation and being eligible, offers herself for re-appointment.

  2 for0 against
• To appoint M/s. M S K A & Associates s, Chartered Accountants (Firm Registration No. 105047W) as statutory auditors of the Company, to hold office for a term of five consecutive years from the conclusion of the 6th Annual General Meeting (AGM) to be held in the year 2024 until the conclusion of the 11th AGM of the Company to be held in the year 2029.MoreLess

  2 for0 against
• Appointment of Mr. Kevin Rohitbhai Daftary(DIN:10637792) as Non-Executive Non Independent Director of the Company.

  2 for0 against
• Approval for increase in limits to provide loan, guarantee or security in respect of loan made to any person or body corporate or to make investment in any other body corporate under Section 186 of the Companies Act, 2013MoreLess

  ›Against HSBC Mutual Fund, Invesco Mutual Fund

  • HSBC Mutual FundA vote AGAINST this resolution is warranted due to lack of information.
  • Invesco Mutual FundGiven the existing networth, regulations allow the company to make loans/ investments, guarantees upto Rs. 15.8 bn. The aggregate of loans, investments and guarantees stood at Rs. 11.1 bn on 31 March 2024. The company proposes to make loans, guarantee and investments (excluding wholly owned subsidiaries) upto the prescribed limits (higher of 60% of total paid up share capital, free reserves and securities premium account or 100% of free reserves and securities premium) such that the total loans, investments, guarantees (including support to wholly owned subsidiaries) may exceed the prescribed limits. This is in line with regulations. We understand that the company has expanded significantly by acquiring regional and local distributors and has made 34 acquisitions till date. While we understand that the company has historically grown primarily through inorganic means, we believe it must provide granular clarity with respect to the proposed investments including the size and nature of such acquisitions (subsidiaries/associates/ etc.). Further, the company must clarify if such investments may be made in entities in which the company’s promoters/ investors are interested. In the absence of such clarity, we do not support this resolution

  0 for2 against
• Ratification of Approval of the ‘Entero Employee Stock Option Plan, 2023’ (“ESOP 2023”/ “Plan”)

  ›Against HSBC Mutual Fund, Invesco Mutual Fund

  • HSBC Mutual FundA vote AGAINST this resolution is warranted because: • The stock options may be issued with an exercise price at a discount to the current market price. • The company has not specified objective performance parameters, performance targets and thresholds for vesting. • The proposal include grant of units to employees of holding company without a compelling rationale.
  • Invesco Mutual FundThe implementation of ESOP 2023 will lead to a dilution of 0.9% on the expanded capital base. While the past ESOPs were granted at fair value, the notice states that the exercise price will not be below face value. If options are granted at the face value of Rs. 10.0, this will represent a discount of 99.2% on the current market price. We do not favour stock option schemes where options are granted at a significant discount (>20%) to market price since stock options are ‘pay at risk’ options that employees accept at the time of grant. In the case of deeply discounted options, there is no alignment between the interests of investors and those of employees. We make an exception in cases where the vesting of such options is mandatorily linked to detailed performance parameters, which must be disclosed in the shareholder notice and must align to shareholder interests. The company must also disclose specific pre-defined performance targets for such parameters. In absence of granular clarity on such parameters and targets, we are unable to support the resolution

  0 for2 against
• Ratification of the extension of the benefits under the ENTERO EMPLOYEE STOCK OPTION PLAN, 2023’ (“ESOP 2023”/ “PLAN”) to the employees of subsidiary companies of the Company

  ›Against HSBC Mutual Fund, Invesco Mutual Fund

  • HSBC Mutual FundA vote AGAINST this resolution is warranted because: • The stock options may be issued with an exercise price at a discount to the current market price. • The company has not specified objective performance parameters, performance targets and thresholds for vesting. • The proposal include grant of units to employees of holding company without a compelling rationale.
  • Invesco Mutual FundThe company proposes to extend the benefits under ESOP 2023 to employees of subsidiary companies. Our view is linked to resolution #6.

  0 for2 against
• Alteration of the Articles of Association of the Company and insertion of clauses pursuant to Regulation 31B of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.MoreLess

  ›Against Invesco Mutual Fund

  • Invesco Mutual FundThe company proposes to alter the Articles of Association to insert new sub clause (b) to Article 131. The proposed amendment grants any investor holding 10% or more of the company’s equity the right to nominate one director to the board, while an investor with a 20% or greater equity stake would have the right to nominate two directors. The proposed rights are equitable for all investors and thus we support such rights. However, the clause also allows such investors to appoint their nominees on board committees (subject to the committee being compliant with regulations). We do not support committee nomination rights irrespective of an embedded minimum shareholding threshold – since determination of committee composition is the prerogative of the board. We do not support the resolution. The company should have disclosed the draft AoA on the website

  1 for1 against