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The Munjals, promoters of India's largest motorcycle company Hero Honda Motors Ltd, will take home a cool Rs 730 crore as dividend income.
The company today announced that its board has declared an interim dividend of Rs 70 a share (or 3,500 per cent for a share of face value Rs 2).
Hero Investments Pvt Ltd and the Munjals, headed by Mr Brijmohan Lall Munjal, Chairman of Hero Honda, are the promoters of the company, after the deal with Honda Motor Co of Japan, when the latter sold its 26 per cent shareholding in the company to the Indian joint venture partners. Honda ceased to be a promoter of the company from April 1, 2011, following the agreement with the Hero group.
Hero Investments and the Munjal family together hold nearly 10.42 crore shares in the company, or a 52.21 per cent stake. In December last, Honda Motor Company and the Indian joint venture partner announced the Japanese company's plans to sell its 26 per cent stake in the company to the Hero group.
The shares of Hero Honda Motors Ltd, as the company is still known, ended up 7.3 per cent on the NSE and closed at Rs 1,759, on a day when the Nifty was up 2.17 per cent.
Hero Honda had paid a dividend of Rs 30 a share for 2009-10 and in March 2010 declared a silver jubilee special dividend of Rs 80 a share.
In July 2010, the Indian ownership of Hero Honda Motors was re-jigged following a family settlement among the Munjals. Consequently, Hero Investments Pvt Ltd, Bahadur Chand Investments Pvt Ltd and various members of Mr Brijmohan Lall Munjal's family became the Indian promoters of Hero Honda.
Financial institutions, insurance companies, mutual funds and foreign institutional investors together hold a 38 per cent stake in the company.
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