Shareholders Reappoint Bina Modi as Godfrey Phillips India MD

Shareholders of Godfrey Phillips India Ltd have overwhelmingly approved the re-appointment of Bina Modi as Managing Director with 86.6% of the votes. Additionally, her daughter Charu Modi's appointment and remuneration were also approved by the required majority, according to the scrutinisers' report submitted to the stock exchanges.

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Board Changes and Shareholder Decisions

The shareholders also passed an ordinary resolution with 99.2% votes to leave the vacancy caused by Samir Modi's retirement unfilled for now. Following the AGM, Samir Modi ceased to be a director on the board. The company stated, "Samir Kumar Modi has retired by rotation w.e.f completion of the 87th AGM of the company held today. Consequently, Samir Kumar Modi has also ceased to be an executive director of the company with effect from said date."

At the annual general meeting on Friday, shareholders addressed several key issues, including not filling Samir Modi's vacancy and appointing Charu Modi as an executive director. Bina Modi received 3.79 crore votes in favour, while 58.55 lakh votes opposed her reappointment.

Focus on Core Competency

In her address, Bina Modi emphasised the company's focus on its core business, aligning with Professor CK Prahalad's Theory of Core Competency. She stated, "This strategy has also led us to the closure of our retail business 24 Seven. At times we need to bite the bullet in the long-term interest of the company and shareholders."

In July, Godfrey Phillips India announced plans to exit its retail business under the '24Seven' brand after a district court lifted an interim injunction against this move. The company's board had approved this exit on April 12, 2024, subject to completing necessary formalities.

Legal Disputes and Injunctions

Earlier, a city court had issued an injunction against hiving off the retail business on June 27, 2024, following an application by Samir Modi. However, this order was set aside by the District Judge of South-East District at Saket Court, New Delhi.

Bina Modi has been involved in a boardroom dispute with her son Samir Modi, who accused her of orchestrating an attack on him during a board meeting. He filed a complaint with Delhi Police alleging that he was stopped from participating in a board meeting on May 30 by Bina Modi's PSO and was injured after being assaulted.

Proxy Advisory Firm's Recommendation

Last month, US-based proxy advisory firm Glass Lewis advised shareholders to vote against Bina Modi's reappointment as MD due to undefined performance conditions for commission payments. Despite this recommendation, shareholders approved her reappointment.

Godfrey Phillips India is part of Modi Enterprises and produces popular cigarette brands like Four Square, Red and White, Cavanders, Tipper, and North Pole. It also manufactures Marlboro under a license agreement with Philip Morris.

The AGM also addressed Bina Modi's remuneration exceeding Rs 5 crore or 2.5% of net profits, requiring a special resolution passed by a super majority of 75% votes polled.

The company's strategic decisions reflect its commitment to focusing on core competencies while navigating internal disputes and legal challenges effectively.