KOCHI: The Kerala State Industrial Development Corporation (KSIDC), the state government-owned company in the news for its equity stake in Cochin Minerals and Rutile Limited (CMRL), is reaping rich rewards for having backed a large number of companies during their initial stages of establishment.
A closer look at the KSIDC annual report reveals that it has investments in about 20 stock market-listed companies including BPCL, Apollo Tyres, Geojit Financial Services, Nitta Gelatin India, and Eureka Forbes. Further, KSIDC is sitting on a huge profit on these investments.
TNIE’s calculations show that the shares owned by KSIDC in these listed companies is worth nearly Rs 900 crore while the total original cost is merely Rs 40 crore. That’s a whopping 2,100% return on its original investment.
KSIDC’s biggest investment in terms of value is in Nitta Gelatin India, a joint venture with Japan’s Nitta Gelatin Inc, where the Kerala partner owns 31.53% stake.
As per Friday’s closing price, KSIDC’s equity stake is worth Rs 273 crore as compared to the original investment of Rs 13.64 crore, without taking into account the dividends that KSIDC has received till now.
Industries Minister P Rajeeve had told reporters last week that KSIDC has investments in 73 companies, including startups.
“KSIDC is investing in companies to promote these ventures,” the minister said, adding that CMRL has paid Rs 4.65 crore to the government for KSIDC’s investment of Rs 1.05 crore.
KSIDC investments in some companies and their value now
KSIDC was established in 1961 to promote industrial projects in Kerala through equity participation and joint ventures
KSIDC’s stake in CMRL valued at Rs 31.73 crore
As on Friday, KSIDC’s stake in CMRL is valued at Rs 31.73 crore.
Apollo Tyres is another big investment by KSIDC in terms of the value of the shareholding. KSIDC’s investment of 50 lakh shares is worth Rs 265 crore as per Friday’s closing price. The cost price of its Apollo Tyres’ investment is Rs 13.71 crore. Geojit Financial Services is the third top investment of KSIDC as per the value of its holding. KSIDC’s 8.36% equity stake in the Kochi-based financial services firm is worth Rs 156.1 crore. Similarly, KSIDC’s investment in BPCL is worth Rs 116.38 crore now as against the cost of Rs 33.34 lakh.
KSIDC’s investment in other stock market-listed companies include Eureka Forbes (Rs 21.86 crore), Rubfila International (Rs 21.88 crore versus cost of Rs 3.42 crore), and Forbes Company (Rs 2.71 crore).
There are several other investments by KSIDC which are not listed on stock market but are prized processions. For instance, KSIDC owns 50 lakh shares in Cochin International Airport Ltd at a total cost of Rs 9 crore. The fair value of the CIAL investment is pegged at Rs 27.4 crore. But not every investment is hunky dory. There are at least six companies, with KSIDC investment, that are under liquidation while the balance sheet is not available in 11 other companies, according to the KSIDC annual report.