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Friday, Mar 08, 2002

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Dividend row kicks up action on CSE

Jayanta Mallick

KOLKATA, March 7

THE Calcutta Stock Exchange on Thursday received a communication from five companies for cancellation of the proposed interim dividend. These companies are: Exide, Jay Shree Tea & Industries, Wipro, Cotspin and Patspin.

A total of 112 corporates had informed the exchange about their intention to declare an interim dividend before March 31. On Budget day itself, one company had intimated the bourse of its board's decision proposing an interim dividend, while 11 companies informed the CSE on March 1, exchange sources said.

The nearest book closure date for any company that informed the exchange about the interim dividend is March 23. This means that, according to exchange norms, the CSE will have to bring to the notice of its members earliest on March 11 the companies that are to be placed in the ex-dividend category.

Most of the companies have placed their record dates between March 23 and March 27. The rest have it between March 28 and March 30. ``In other words, if a company, which has already expressed its intention to declare an interim dividend does not communicate cancellation of its proposal or postponement of it, then the record date will remain effective,'' said an exchange official.

However, such a move would be construed as a violation of the Clause 16 of the listing agreement. The Securities and Exchange Board of India officials were in touch with the exchange authorities on the unfolding developments.

Market observers feel that if a company or a number of companies violate the listing agreement notice period for fixing the record date, there would be uniform invocation of the penal provision including the number of days the scrips would be suspended. ``SEBI may also, exercising powers vested with it, suspend such shares from all bourses for a longer period of time,'' they felt.

Meanwhile, many of the brokers today reversed their deals in the counters in which they had bought in the cash market and sold in the March futures segment in anticipation of the forthcoming interim dividend.

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