How Recovery of Piramal Ltd. Shares from IEPF Could be Great for Investors?

Piramal Enterprises Limited (PEL) has a diversified portfolio of pharmaceuticals and financial lending business based on the wholesale lending model. The company has made heavy growth in the financial sector in the last few decades and came out as a big player in the Indian financial market. The company through its retail lending business gives housing loans. It is also working on creating a multiproduct based retail lending platform for its customers to streamline the lending process. The company also owns IndiaRF or India Resurgence Fund as part of its financial business. IndiaRF is a distressed asset investment platform specializing in investments related to equity and debt portfolio of non-real estate sectors. The Piramal Pharma Limited (PPL) is its pharma subsidiary offering services and products related to medicine manufacturing. The company manufactures over the counter medicinal products in India and has an integrated development and manufacturing facility.

Growth of shares of Piramal over the years:

• Suppose you purchased 300 stocks of Piramal in 1990.
• In 1991, it issued bonus shares in ratio 1:1. This meant that for every single share owned by the investors the company gifted one paid-up share. Thus, the bonus share issued took the total no. of shares to 600.
• In 1993, the company again issued the bonus shares at 1:2. So for every 2 shares owned you would have got one more. With this, the total no. of shares became 900.
• For the next 10 years, the values of these shares reached a really high value and thus the company had to split its stocks in the ratio 1:5 to reduce its share price. The stock split meant that every single share has been divided into 5 shares of equal value with their total equal to the value of a single share before split. Thus, the net valuation of shares remained constant.
  Due to the split, the new value of your shares in 2004 became 4500.
• Now, as of January 2021, the value of each Piramal Share is Rs. 1311.45. So, the total value of the shares will be
  ₹ 1311.45 x 4500 shares = Rs. 59,01,525 (Fifty Nine Lakh One Thousand Five Hundred and Twenty Five).

The above amount doesn’t have the value of the associated dividend with it. Piramal in its years of operation has paid its investors some really handsome dividends and thus if we add those the net value of returns will become huge.

Source for Data: https://in.investing.com/equities/piramal-healthcare-company-profile

In the following table, we have sourced the history of dividends paid by Piramal Enterprises in the last two and a half decades. Investors can calculate the respective dividends for the investment mentioned in the previous section easily. The resultant amount will be near to one crore. This shows how profitable it is to recover old shares of Piramal is as they can be worth millions in today’s scenario.

History of Piramal’ Dividends

Announcement Date	Effective Date	Dividend Type	Dividend (%)	Remarks
11/05/2020	16/07/2020	Final	700%	Rs.14.0000 per share (700%) Final Dividend
26/04/2019	18/07/2019	Final	1400%	Rs.28.0000 per share (1400%) Final Dividend
28/05/2018	19/07/2018	Final	1250%	Rs.25.0000 per share (1250%) Dividend
12/05/2017	21/07/2017	Final	1050%	Rs.21.0000 per share (1050%) Dividend
09/03/2016	17/03/2016	Interim	875%	Rs.17.5000 per share (875%) Interim Dividend
07/05/2015	28/07/2015	Final	1000%	Rs.20.0000 per share (1000%) Dividend
05/05/2014	15/07/2014	Final	2625%	Rs.52.5000 per share (2625%) Dividend
03/05/2013	15/07/2013	Final	875%	Rs.17.5000 per share (875%) Dividend
03/05/2012	09/07/2012	Final	875%
06/05/2011	28/07/2011	Final	600%	Recommended dividend of Rs.6 per Equity Share of face value of Rs.2/- (i.e. @ 300%) & One-time Special Dividend of Rs.6 per Equity Share of face value of Rs.2/- (i.e. @ 300%).
10/05/2010	29/06/2010	Final	270%
24/04/2009	05/06/2009	Final	210%
24/04/2008	16/06/2008	Final	210%
26/04/2007	31/05/2007	Final	25%	AGM
08/03/2007	23/03/2007	Interim	150%
25/04/2006	15/06/2006	Final	150%	AGM
26/04/2005	24/06/2005	Final	150%	AGM & Right Issue of Equity Shares
22/04/2004	11/06/2004	Final	150%	AGM
24/04/2003	29/05/2003	Final	105%	AGM
29/04/2002	05/06/2002	Final	85%	AGM
04/05/2001	11/06/2001	Final	70%
31/03/2000		Interim	65%	Revised From 06/05/2000 Revised % 12.00
06/05/1999		Final	55%

The Need for Investor Education and Protection Fund

If you are not new to the Indian financial market, then you must be aware of the term IEPF. However, most of the investors have little to no knowledge of the IEPF rules and regulations that companies have to follow. Before we move on to understanding the rules of funds transfer stated by IEPF, we must understand the need for Introducing IEPF.

The Government of India in 2016 came up with IEPF which was considered a major reform at that time considering the lack of a statutory body to address the issue of unclaimed dividends. The IEPF Authority was responsible for handling the claims for unpaid dividends older than seven years. This was needed as earlier there were no rules and regulations for companies regarding the unclaimed dividends that are left dormant with them. due to this, funds used to remain dormant for years with the companies. Some companies used to transfer their unclaimed funds to the government for use in public welfare schemes. Thus, the government decided to regulate these huge dormant funds by forming a statutory body to look after them. The IEPF rules were formed and stated the conditions for the transfer of money to the fund.

IEPF Rules:

• It made claim of the fund necessary for investors within 30 days of its release.
• The companies were obliged to form a special unclaimed fund account.
• Dividends older than 30 days were to be transferred to this special account.
• If the investors wanted to claim money from this special account, they must make the claim to the transfer officer of the company.
• If the claims remained in the special account for 7 years, then the companies must transfer them to the IEPF.
• After 7 years, a shareholder has to apply on the IEPF website to claim his/her dividends.

Status of Unclaimed Holdings of Piramal Enterprises

In this section, we will get into Piramal Enterprises annual reports and documents related to unclaimed shares and dividends before moving to the part of how to claim the money from IEPF and why an investor should hire a consultant to claim the money.

As per the financial report of the company for the year 2019-20, IEPF holds 0.31% of Piramal’s shares. This data alone is enough to demonstrate how much of Piramal’s dormant shares are lying with IEPF. The company has transferred a huge no. of shares and dividends in all its previous financial years to IEPF. In the following table which has been sourced from the company’s annual report of 2019-20, the last dates for transfer of funds for seven financial years have been shown. Investors are requested to take note of these dates to make their claims accordingly.

Dates of Fund Transfer to the IEPF:

Financial Year	Date of declaration of Dividend	Due date for transfer
2012-13	July 25, 2013	August 25, 2020
2013-14	July 25, 2014	August 25, 2021
2014-15	September 6, 2022	August 6, 2015
2015-16 (Interim)	March 9, 2016	April 9, 2023
2016-17	August 1, 2017	September 1, 2024
2017-18	July 30, 2018	August 30, 2025
2018-19	July 30, 2019	August 30, 2026

Apart from giving the data on funds transferred to IEPF and the related dates for future transfer, the company also releases individual documents every with details of the shareholders of unclaimed dividends in Piramal enterprises. This must be done by the company as per the IEPF rules.

An investor can simply check these documents to know the status of their dividends (whether they have been transferred to the IEPF or not). For the convenience of our reader, we have given the direct link to those documents containing details of every shareholder whose unclaimed shares and dividends have been transferred to the IEPF.

• Report of data containing detail of shareholders whose dividends have been transferred to IEPF in the fiscal year 2019-20; https://www.piramal.com/wp-content/uploads/2020/10/Equity-Unclaimed-Dividend-FY-2018-19.pdf

Links to reports of unclaimed dividend for the previous seven financial years:

• Unclaimed Dividend Report for Financial Year 2018-19:

https://www.piramal.com/wp-content/uploads/2020/10/Equity-Unclaimed-Dividend-FY-2018-19.pdf

• Unclaimed Dividend Report for Financial Year 2017- 18:

https://www.piramal.com/wp-content/uploads/2020/10/Equity-Unclaimed-Dividend-FY-2017-18.pdf

• Unclaimed Dividend Report for Financial Year 2016 – 17:

https://www.piramal.com/wp-content/uploads/2020/10/Equity-Unclaimed-Dividend-FY-2016-17.pdf

• Unclaimed Dividend Report for Financial Year 2015-16:

https://www.piramal.com/wp-content/uploads/2020/10/Equity-Unclaimed-Dividend-FY-2015-16.pdf

• Unclaimed Dividend Report for Financial Year 2014 – 15:

https://www.piramal.com/wp-content/uploads/2020/10/Equity-Unclaimed-Dividend-FY-2014-15.pdf

• Unclaimed Dividend Report for Financial Year 2013 – 14

https://www.piramal.com/wp-content/uploads/2020/10/Equity-Unclaimed-Dividend-FY-2013-14.pdf

• Unclaimed Dividend Report for Financial Year 2012 – 13:

https://www.piramal.com/wp-content/uploads/2020/10/Equity-Unclaimed-Dividend-FY-2012-13.pdf

• Annual Report 2019-20 Link:

https://www.piramal.com/wp-content/uploads/2020/09/PELl_AR_20-07_final.pdf

The reports of the unclaimed dividend shown above give a complete overview of the transferred shares of Piramal. Investors can the details of their dividends form these reports or the website of the company or contact the Nodal officer of Piramal Ltd. Mr Bipin Singh, (Company Secretary). They can also mail the officer on complianceofficer.pel@piramal.com for any query related to their investment. For any other information regarding unclaimed stocks of Piramal, and a shareholder can visit: https://www.piramal.com/investor/shareholder-information/unclaimed-dividend/

Why Should a Shareholder Hire a Financial Consultant? 

Before we move on to tell you why is it necessary to hire a Financial/legal consultant to claim dividends from IEPF, we must first understand the process of claiming dividends. The process of claiming dividend form IEPF involves four basic steps.

• In the first step, the claimant must go to the IEPF’s website and fill the application form to initiate the process.
• Once the form is filled he/she should download it and send it to the nodal officer of the Piramal Enterprises along with the necessary documents related to ownership of shares and details of the Claimant.
• Post this, the nodal officer of Piramal will verify the documents and form and send a verification report along with documents to the IEPF authority stating that the documents and the ownership of shares have been verified from his end. This report must be sent within 15 days of receiving the application by the officer.
• In the final step, the IEPF authority verifies the report and documents along with the application form of the claimant and if satisfied, it will clear the claim and sanction the claimed dividend. If the Authority finds any fault with the application, then it may reject it. In case of any missing documents, it gives information to the claimant asking for it through the Nodal Officer. Thus, a claimant must remain in contact with Nodal Officer as well as the Authority till the claim is passed.

Now you must have understood how tricky and time consuming the claim process can get. This is one of the main reasons why it is recommended that the claimant should hire a financial consulting firm with legal experts who can handle the claim process on his/her behalf. This reduces the burden on the claimant and makes the process smooth too. Also, legal experts can help the claimant in proving their ownership of shares in case of any dispute. The experts also ensure that the application is error free and compliant with the norms of IEPF.

To conclude we can only say, recovery of Piramal Shares could prove to be a profitable thing for investors and if they find old shares of this company then they must claim them from IEPF authority.

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