Grounded Kingfisher's shareholder base zooms to record high

In a logic-defying trend, the number of shareholders at Kingfisher Airlines has zoomed to a record high level of about 2.4 lakh investors even as the carrier has remained grounded for over nine months and its market value has plummeted by over 90%.

Also, it is the small retail investors who account for nearly 97% of the overall shareholder base of the currently non-operational and heavily debt-laden aviation venture of Vijay Mallya-led UB group.

According to the company's latest shareholding pattern, over 2.3 lakh small retail shareholders currently own shares in Kingfisher Airlines, while other investors include about 3,600 high net worth individuals and close to 2,300 NRIs.

Total number of promoter shareholders is just six, including Mallya himself and his group entities, while the number of various institutional investors is also very small.

Moreover, the number of institutional investors has continued to decline for many months now even as the retail investor base went on rising.

The overall investor base of the company stood at more than 2.38 lakh at the end of last fiscal and it has witnessed a continuous uptrend for past few years -- from about 1.4 lakh at the end of 2011-12, about 98,000 as on March 2011, about 84,000 a year prior to that, 67,000 in March 2009 and just about 50,000 in March 2008.

Burdened under huge losses and large debts, the airline stopped flying in October 2012 and its flying license also lapsed about two months later. Lenders have also begun their recovery process for close to Rs 8,000 crore worth loans and accumulated losses have ballooned to over Rs 16,000 crore. Kingfisher is yet to make profit since starting operations in 2005.

According to experts, the large investors managed to exit the stock at a right time and with smaller losses, but small investors got stuck in the company on hopes the company would be back on its revival path someday. The company currently carries a market value of just about Rs 400 crore, from a peak valuation of close to Rs 10,000 crore at one point of time.

     
Its shares are currently trading near Rs 5 level, from close to Rs 20 late last year and near Rs 75 per share few years ago. Shares hit an all-time low of Rs 3.86 last month.

Experts say small investors are stuck with the stock now, as the value of their holdings is too meagre.

According to the company's shareholding pattern, the six promoters together hold over 32% stake, although nearly 90% of their holding is pledged with lenders.

On the other hand, the collective holding of nearly 2.3 lakh small investors is only about 20% and the total value of this stake is now just about Rs 80 crore -- as against a peak valuation of about Rs 2,000 crore.

Among other investors, nearly 3,600 HNIs together own 16.5% stake in the company, while 12 FIIs have less than one%
stake. There are 16 domestic financial institutions and banks and two insurers also with a stake of about 13%.