Manpasand Beverages (Delisted) MD, chairman, board of directors and AGM

Mutual fund votes, meeting of 31 Dec 2020, 1 fund house

• To receive, consider and adopt, the Audited Financial Statements (Including audited Consolidated Financial Statements) of the Company for the financial year ended March 31, 2020, together with the reports of Board and Auditors thereonMoreLess

  1 for0 against
• To appoint a director in place of Mr. Abhishek Singh (DIN: 01326637), who retires by rotation and being eligible, offers himself for re-appointment.

  ›Against SBI Mutual Fund

  • SBI Mutual FundAbhishek Singh, 31, is part of the promoter family and Whole-time Director, Manpasand Beverages Ltd. He has attended 71% of the board meetings in FY20 and 84% of the board meetings in the previous three years. In May 2019, he was arrested by authorities following a search and seizure conducted by Income Tax authorities over GST. The company had to pay Rs. 177.8 mn to the GST authorities: as a result of which majority of directors on the board also resigned. Further, some directors in their resignation letters have raised concerns over the way board meetings were being held, which included allegations of purposefully excluding a certain set of directors, disagreements between management and the rest of the board, which has been contested by the company. Also, in FY20, two auditors resigned, citing lack of management co-operation in either providing information or access to factory sites. The stock price has decreased by 98.2% since listing, signalling a lack of investor confidence in management. Hence, we do not support Abhishek Singh’s reappointment to the board.

  0 for1 against
• To appoint Mrs. Bharti Naik (DIN: 06627217), as Non- Executive & Non-Independent Director.

  ›Against SBI Mutual Fund

  • SBI Mutual FundMs. Bharti Naik was first appointed as an Independent Director in August 2014. In the FY19 AGM the company had proposed to reappoint her as Independent Director, however, shareholders did not support her reappointment. The company now proposes to appoint her as a Non-Executive Non-Independent director. However, no details have been provided by the company regarding this change in designation. Further, during her previous tenure, the company’s key management personnel were arrested by authorities following a search and seizure by Income Tax authorities over GST, three auditors resigned, some citing lack of information flow from management and access to factory premises. Some directors in their resignations have implicated her in participating in board meetings that purposefully excluded some directors. We believe she failed to discharge her fiduciary responsibilities as a director. Therefore, we do not support her appointment to the board.

  0 for1 against

Mutual fund votes, meeting of 25 Nov 2020, 1 fund house

• TO APPOINT MR. DHIRENDRA SINGH (DIN: 00626056) AS MANAGING DIRECTOR OF THE COMPANY

  ›Against SBI Mutual Fund

  • SBI Mutual FundShareholders did not support Dhirendra Singh’s reappointment and remuneration in the FY19 AGM. During his tenure at the helm, the company faced GST searches and investigation proceedings, after which the company had to pay Rs. 177. 8 mn to the GST authorities, as a result of which a majority of directors on the board also resigned. Further, some directors in their resignation letters have raised concerns over the way board meetings were being held, which included allegations of purposefully excluding a certain set of directors, vehement disagreements between management and the rest of the board, and the avoidance of undertaking a forensic audit: this has been contested by the company. Over the past twelve months, two auditors have resigned, citing lack of management co-operation in either providing information or access to factory sites. The latest available annual financial statements (FY19) raise concerns over the company’s internal controls, amongst other issues. The stock price has decreased by 98. 4% over a three-year period signalling a lack of investor confidence in management. The reduction in his proposed remuneration to Rs. 12 mn from the earlier Rs. 25 mn is not material to our decision – we do not support Dhirendra Singh’s reappointment to the board, given the destruction of shareholder value.

  0 for1 against
• TO APPOINT MR. ABHISHEK SINGH (DIN: 01326637) AS WHOLE TIME DIRECTOR OF THE COMPANY.

  ›Against SBI Mutual Fund

  • SBI Mutual FundShareholders did not support Abhishek Singh’s reappointment the board in FY19 AGM. The company faced GST searches and investigation proceedings, after which the company had to pay Rs. 177. 8 mn to the GST authorities: as a result of which majority of directors on the board also resigned. Further, some directors in their resignation letters have raised concerns over the way board meetings were being held, which included allegations of purposefully excluding a certain set of directors, vehement disagreements between management and the rest of the board, and the avoidance of undertaking a forensic audit: this has been contested by the company. In May 2019, Abhishek Singh was arrested by authorities over his alleged involvement in the same searches and seizure. Over the past twelve months, two auditors have resigned, citing lack of management co-operation in either providing information or access to factory sites. The latest available annual financial statements (FY19) raises concerns over the company’s internal controls, amongst other issues. The stock price has decreased by 98. 4% over a three-year period signalling a lack of investor confidence in management. The reduction in his proposed remuneration to Rs. 12 mn from the earlier Rs. 15 mn is not material to our decision – we do not support Abhishek Singh’s reappointment to the board, given the destruction of shareholder value.

  0 for1 against
• TO APPOINT MR. VIMAL PATEL (DIN: 08656473) AS AN INDEPENDENT DIRECTOR

  ›Against SBI Mutual Fund

  • SBI Mutual FundAccording to the shareholder notice, Vimal Patel, 50, is the President of a Co-operative Bank and has experience in the field of banking. He holds 118,000 equity shares in the company. The information disclosed on Vimal Patel is not sufficient for us to make an informed decision. Therefore, we do not support his appointment to the board. We expect the company to provide a more detailed profile for the proposed director appointment. As a member of the Nomination and Remuneration Committee, we believe Vimal Patel has failed in discharging his fiduciary responsibility by appointing the promoters back to the board, after their reappointments were not approved by shareholders in the FY19 AGM.

  0 for1 against
• TO APPOINT MR. KAUSHAL AMETA (DIN: 02143786) AS AN INDEPENDENT DIRECTOR

  ›Against SBI Mutual Fund

  • SBI Mutual FundKaushal Ameta, 41, is a member of the Institute of Company Secretaries of India and is a practicing company secretary. He has over 14 years of professional experience in the field of Corporate Law, Finance, and Investments. As a member of the Nomination and Remuneration Committee, we believe Kaushal Ameta has failed in discharging his fiduciary responsibility by appointing the promoters back to the board, after their reappointments were not approved by shareholders in the FY19 AGM. Therefore, we do not support his appointment to the board.

  0 for1 against
• TO APPOINT MS. SHIKHA JAIN (DIN: 08087342) AS AN INDEPENDENT DIRECTOR

  ›Against SBI Mutual Fund

  • SBI Mutual FundMs. Shikha Jain, is a member of the Institute of Company Secretaries of India and has an aggregate of seven years of corporate experience, of which two years are as a practicing company secretary. We believe Shikha Jain does not possess sufficient experience to be on the board of a listed company.

  0 for1 against

Mutual fund votes, meeting of 30 Dec 2019, 1 fund house

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

• ORDINARY - ADOPTION OF FINANCIAL STATEMENTS

  ›Against SBI Mutual Fund

  • SBI Mutual FundThe provisions made in the accounts relating to credit losses on capital advances, bad debts and write off of credit notes point towards diversion of funds and inflated historical sales. This result in the aftermath of 1> GST related search and investigation which led to arrest of company executives and a penalty, 2> previous auditor (M/s Batliboi & Purohit) writing to the board about several discrepancies in the books of account, 3> resignation by board members and 4> dispute with new lenders, suggests that any financial records submitted by the company is likely to be untrustworthy till the existing promoters are at helm of affairs.

  0 for1 against
• APPOINTMENT OF STATUTORY AUDITORS TO FILL CASUAL VACANCY

  ›Against SBI Mutual Fund

  • SBI Mutual FundOver the past six months, three auditors have resigned, without giving their opinion on the FY19 financials. Reasons for resignations included lack of cooperation from management in providing critical information for the audit, to not allowing the auditors to not enter the Vadodara factory. To fill the casual vacancy cause by the resignation of Batliboi & Purohit on 3 October 2019, the company appointed Bagaria & Co LLP as the auditors. They hold the position till the conclusion of the 2019 AGM. We raise concern that Bagaria & Co LLP has not qualified the financial statements, given several concerns that include not having access to complete records (since several of those remain the custody of GST authorities), and the authenticity of trade receivables. We believe how the audit process addressed revenue recognition (a key audit matter) raises several unanswered questions. These issues must be seen in context of the auditor’s own concerns over the adequacy of the company’s internal controls. Therefore, we raise concern over the quality of audit services provided by Bagaria & Co LLP. Further the audit committee was reconstituted on the date of appointment of the auditor; therefore, we are unclear about its role in the appointment of the audit firm.

  0 for1 against
• RE-APPOINTMENT OF STATUTORY AUDITORS

  ›Against SBI Mutual Fund

  • SBI Mutual FundOver the past six months, three auditors have resigned, without giving their opinion on the FY19 financials. Reasons for resignations included lack of cooperation from management in providing critical information for the audit, to not allowing the auditors to not enter the Vadodara factory. To fill the casual vacancy cause by the resignation of Batliboi & Purohit on 3 October 2019, the company appointed Bagaria & Co LLP as the auditors. They hold the position till the conclusion of the 2019 AGM. We raise concern that Bagaria & Co LLP has not qualified the financial statements, given several concerns that include not having access to complete records (since several of those remain the custody of GST authorities), and the authenticity of trade receivables. We believe how the audit process addressed revenue recognition (a key audit matter) raises several unanswered questions. These issues must be seen in context of the auditor’s own concerns over the adequacy of the company’s internal controls. Therefore, we raise concern over the quality of audit services provided by Bagaria & Co LLP.

  0 for1 against
• TO RE-APPOINT MR. DHIRENDRA SINGH DIN 00626056 AS MANAGING DIRECTOR OF THE COMPANY

  ›Against SBI Mutual Fund

  • SBI Mutual FundAlthough Dhirendra Singh’s proposed remuneration remains the same at Rs. 25mn annually, we do not support his reappointment to the board. Dhirendra Singh is the founder and the Managing Director. On account of the pending investigations by Income Tax authorities over GST, four directors resigned from the board, signalling a lack of the board’s faith in the executive management. Over the past six months, three auditors have resigned, some citing lack of management co-operation in either providing information or access to factory sites. The audit of FY19 financial statements raises concerns over the company’s internal controls, amongst other issues. Further, some directors in their resignation letters have raised concerns over the way board meetings were being held, which included allegations of purposefully excluding a certain set of directors, vehement disagreements between management and the rest of the board, and the avoidance of undertaking a forensic audit. There has been a ~89% erosion in the company’s market capitalization over the past seven months, which is perhaps reflective of lack of investor confidence in the management. Therefore, we do not support the continuation of the executive management on the board of the company.

  0 for1 against
• TO RE-APPOINT MS. BHARTI NAIK DIN 06627217 AS AN INDEPENDENT DIRECTOR

  ›Against SBI Mutual Fund

  • SBI Mutual FundMs. Bharti Naik was appointed as an Independent Director in August 2014. During her tenure, the company’s key management personnel were arrested by authorities following a search and seizure by Income Tax authorities over GST, three auditors resigned, some citing lack of information flow from management and access to factory premises, revenues declined and the market capitalization eroded by ~89% from its peak level. Some directors in their resignations have implicated her in participating in board meetings that purposefully excluded some directors. We believe she failed to discharge her fiduciary responsibilities as a director. Further, given her academic background and experience in Human Resources, we do not support her membership of the audit committee.

  0 for1 against
• TO APPOINT MR. NISHISH MOBAR DIN 08582046 AS AN INDEPENDENT DIRECTOR

  ›Against SBI Mutual Fund

  • SBI Mutual FundNishish Mobar is a banking professional with over 36 years of experience. He will be a part of the Nomination and Remuneration Committee. We expect the company to provide a more detailed profile of the director. Without such details we will however doubt the credibility of the individual.

  0 for1 against
• WAIVER OF RECOVERY OF EXCESS MANAGERIAL REMUNERATION PAID TO MR. DHIRENDRA SINGH, MANAGING DIRECTOR OF THE COMPANY FOR THE FINANCIAL YEAR ENDED 31ST MARCH, 2019

  ›Against SBI Mutual Fund

  • SBI Mutual FundDhirendra Singh is the promoter and MD. His FY19 remuneration aggregated Rs.25.0 mn, which was 92x the median employee remuneration. With the financial inaccuracies coming to light, Manpasand reported a net loss of Rs. 5.9 bn in FY19, and therefore made inadequate profits. The company seeks shareholders’ approval to waive off the recovery of excess remuneration. The executive management has failed to address material concerns of multiple stakeholders, which has consequently led to a significant erosion in the market capitalization of the company and destroyed shareholder wealth. We do not support the waiver of recovery of the excess remuneration of Rs.12.6 mn paid to Dhirendra Singh.

  0 for1 against
• WAIVER OF RECOVERY OF EXCESS MANAGERIAL REMUNERATION PAID TO MR. ABHISHEK SINGH, WHOLE TIME DIRECTOR OF THE COMPANY FOR THE FINANCIAL YEAR ENDED 31ST MARCH, 2019

  ›Against SBI Mutual Fund

  • SBI Mutual FundAbhishek Singh is part of the promoter family and ED. His FY19 remuneration aggregated Rs.15.0 mn, which was 55x the median employee remuneration. With the financial inaccuracies coming to light, Manpasand reported a net loss of Rs. 5.9 bn in FY19, and therefore made inadequate profits. The company seeks shareholders’ approval to waive off the recovery of excess remuneration. The executive management has failed to address material concerns of multiple stakeholders, which has consequently led to a significant erosion in the market capitalization of the company and destroyed shareholder wealth. We do not support the waiver of recovery of the excess remuneration of Rs. 2.6 mn paid to Abhishek Singh.

  0 for1 against

Mutual fund votes, meeting of 13 Sep 2018, 3 fund houses

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

• Adoption of Balance Sheet, Statement of Profit and Loss, Board's Report and Auditor's Report for the Financial year ended 31st March, 2018

  2 for0 against
• Recommendation of dividend on Equity Shares

  3 for0 against
• Re-appointment of Mr. Abhishek Singh, who retire by Rotation.

  3 for0 against
• Re-appointment of Auditors and fixing their remuneration

  3 for0 against

Mutual fund votes, meeting of 5 Jul 2018, 3 fund houses

• 1) Appoint M/s. Mehra Goel & Co. as Statutory Auditors for FY18 to fill the casual vacancy caused by the resignation of M/s. Deloitte Haskins & Sells.

  1 for0 against
• Appointment of Statutory Auditors to fill Casual Vacancy.

  1 for0 against
• To appoint M/s Mehra Goel & Co, Chartered Accountants, New Delhi (FRN 000517N) as Statutory Auditors of the Company to fill the casual vacancy caused by the resignation of M/s. Deloitte Haskins & Sells, Chartered Accountants, VadodaraMoreLess

  1 for0 against

Mutual fund votes, meeting of 28 Nov 2017, 2 fund houses

• 1) Increase Foreign Institutional Investors investment limit from 24% to 49% of the paid-up equity share capital of the Company.

  1 for0 against
• Increase in the limit of total shareholding of all Registered Foreign Institutional Investors (FIIs) put together from 24% up to 49% of the paid-up equity share capital of the Company

  1 for0 against