Raymond's stock dips on news of Vijaypat Singhania's sacking as chairman-emeritus

Raymond, one of India's largest clothing brands, which has been embroiled in a family dispute since last August, saw its share price dip 4.4% today on reports that Vijaypat Singhania has been sacked from his position as the Group's chairman-emeritus. The man credited with building the brand - and father to the current chairman and managing director of Raymond Ltd - was reportedly informed of his removal in a letter.

According to Mumbai Mirror, the summary sacking followed a series of letters Singhania wrote, first to the company secretary and then to the board, complaining that he was not being kept in the loop about board meetings.

"Considering the aspersions cast against the Board, the company and the chairman and managing director, including repeated unparliamentary language, the board has decided to withdraw the title of chairman-emeritus post your vacation of office as a director," read a September 7 letter signed by Thomas Fernandes, Raymond's director secretarial and company secretary. "You are hereby advised to refrain from using or attempting to using the title of Chairman-Emeritus henceforth, including levying your claim on this as alleged by you in your letter, since this could invite legal consequences in future."

The letter reportedly made it clear that the company was in no way concerned with what is happening between the family, and that the decision to take away his title was taken by the board due to his behaviour. According to the daily, Singhania wrote back saying he would defy the board unless or until he was shown proof of the board's decision to sack him. He added that he has known most of the directors personally for years and that they are aware of his services rendered to the company over two decades.

Citing a company official the report added that under Section 167 of the Companies Act, a person ceases to be a director if they don't attend four consecutive board meetings within one year. Besides, the title of chairman-emeritus isn't in the Act - it is just a title given by a company.

In a previous letter, addressed to the board on August 30, the patriarch had blamed his son, Gautam Singhania's "manoeuvres" for his removal from the company. It further alleged that his son had refused to return various "precious and rare articles" belonging to him, such as his Padma Bhushan medal, paintings and pictures.

The latter, however, denied all the allegations and attributed the "missing things" complaint to his father's age. "My father does not remember where he has kept these things. I don't have any of his belongings. What will I do by holding these things with me?" Gautam Singhania posed to the daily. "I am pained to see my father behaving this way. If he has a problem, I am ready to sit across with him and sort all his problems. But, so far as the company's functioning is concerned, I have nothing to do with him not being the chairman-emeritus anymore. It was the decision of the Board and the Board must have its reason to do whatever they did. I have no role to pay in it."

(Edited by Sushmita Choudhury Agarwal)