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Apr 11, 2023
Fables of ESOPs: March sees ESOP Buyback by Souled Store
March saw ESOP activity form a handful of companies. Let’s do a quick round-up.
Welcome to the new edition of Fables of ESOPs for the month of September. In this edition of, we explore the latest developments highlighting how major companies like Capgemini, Nykaa, and Delhivery are expanding their ESOP pools. From newly introduced plans to strategic allocations, these moves not only enhance employee engagement but also offer them a stake in their company’s future success.
Let’s dive into the latest trends and announcements that underscore the rising significance of ESOPs in today’s corporate landscape.
Capgemini has launched its eleventh employee share ownership plan (ESOP), open to 97% of its 1.7 lakh employees in India, with eligibility requiring a minimum tenure of three months. Employees can invest a minimum of €100 (approximately Rs 9,000), with a maximum investment capped at 25% of their annual salary. The plan allows employees to purchase shares that will be locked in for five years, benefiting from any potential growth in the company's stock price.
Capgemini's previous ESOP attracted 50,000 employees from 32 countries, raising €467 million. The new shares' subscription price will be set in November, with a capital increase expected by December.
Aditya Birla Capital has allotted 45,537 equity shares under its ESOP program. As a result, the company's paid-up equity share capital will increase from ₹26,05,05,70,040 (2,60,50,57,004 shares with a face value of ₹10 each) to ₹26,05,10,25,410 (2,60,51,02,541 shares with a face value of ₹10 each).
Before this, Aditya Birla announced 4.29 lakh equity shares under ESOP in August.
On September 20, 2024, EID Parry (India) allotted 15,084 equity shares under its ESOP scheme. Following this allotment, the company's issued, subscribed, and paid-up equity share capital increased from ₹17,75,52,077 to ₹17,75,67,161, consisting of 17,75,67,161 equity shares with a face value of ₹1 each.
Before this, EID Parry (India) allotted 34,486 Equity Shares at face value of Rs.1
The Board of KFin Technologies approved the allotment of 32,133 equity shares with a face value of ₹10 each under the KFin Employee Stock Option Plan 2020. As a result, the company's issued, subscribed, and paid-up equity share capital increased from ₹171.37 crore (17,13,75,065 shares) to ₹171.40 crore (17,14,07,198 shares).
Before this, KFin Technologies allotted 22,522 and 15,380 equity shares in August and June respectively both at the face value of Rs. 10 each.
Alkyl Amines Chemicals allotted 5,006 equity shares under its ESOP plan. Following this, the company's paid-up equity share capital increased from ₹10,22,62,064 (5,11,31,032 shares of ₹2 each) to ₹10,22,72,076 (5,11,36,038 shares of ₹2 each).
Before this, Alkyl Amines Chemicals issued 9637 new equity shares in June at the face value of Rs. 2 each.
Bajaj Electricals has distributed 44,375 fully paid equity shares, valued at ₹2 each, to 14 employees as part of its 'Employee Stock Option Plan-2015'. As a result, the company's issued, subscribed, and paid-up capital now consists of 11,52,77,328 equity shares of ₹2 each, totaling ₹23,05,54,656.
Before this, they issued 36,875 equity shares of Rs.2 each in June.
Poonawalla Fincorp has enhanced its employee benefits by granting 500,000 stock options to eligible employees under its ESOP 2024. The options will be issued at an exercise price of ₹390.60 per share, as per the company's filings with the NSE and BSE.
Despite the positive announcement, the company’s share price dipped by 0.50% to ₹386.25 on the BSE as of September 3, while its market capitalization stood at ₹30,009.43 crore.
Paytm has allotted 2.54 lakh equity shares to eligible employees under its ESOP. Of these, 2,54,288 shares were issued under the 2019 ESOP scheme, and 620 shares under the 2008 scheme, each with a face value of ₹1.
Following this allotment, Paytm's issued, subscribed, and paid-up equity share capital increased from ₹63.63 crore to ₹63.66 crore. Based on Paytm’s last closing price, the value of the newly allotted shares is approximately ₹5.65 crore, with an exercise price of ₹9 per share.
Honasa Consumer Ltd, the parent company of brands like Mamaearth and The Derma Co, has approved the allotment of 5,79,849 equity shares to eligible employees under its ESOP. This includes 5,46,601 shares under the ESOP 2018 plan, with 4,26,454 shares at an exercise price of ₹20.43 and 1,20,147 shares at ₹252.41, and 33,248 shares under the ESOP 2021 plan.
The total value of the allotted shares is ₹29.23 crore based on Honasa’s recent closing price. Following this allotment, Honasa's paid-up equity share capital will increase from ₹32.42 crore to ₹32.48 crore. This comes after the company allotted 3,97,169 shares in August 2024 and granted ESOPs worth ₹20 crore in 2021.
ideaForge's executive committee approved the issuance of 3,936 equity shares, each with a face value of INR 10, to facilitate the exercise of vested options at the same price. The total valuation of these shares is approximately INR 27.41 lakh. As a result of this allotment, the company's paid-up capital saw a slight increase from INR 43,02,49,000 to INR 43,02,88,360. Additionally, the company has acquired an undisclosed stake in the Bengaluru-based spacetech startup GalaxEye Space for INR 8.28 crore.
Delhivery, a major logistics company, has expanded its employee stock option plan (ESOP) by granting 63,538 stock options to eligible employees. Valued at over INR 2.6 crore, the options will vest over four years: 10% after 12 months, 30% after 24 months, and the remaining 60% at a rate of 15% every six months thereafter.
This follows a previous allocation of 1,66,122 stock options under the same ESOP 2012 scheme in August and over 6.49 lakh stock options across various ESOP schemes in July.
Tracxn Technologies has issued 180,000 equity shares under its ESOP 2016 plan to eligible employees at an exercise price of INR 1 per share, raising the company's paid-up share capital from INR 10.45 crore to INR 10.47 crore.
This follows a prior allotment of 99,707 shares in August
Nykaa, a beauty and fashion e-commerce startup, has allotted 7.65 lakh equity shares under its employee stock option (ESOP) schemes. Valued at approximately INR 15.9 crore based on the day's closing price of INR 207.65, these shares were issued following the exercise of vested stock options.
This follows previous allotments of 1.73 lakh shares worth INR 3.13 crore in July and 4.73 lakh shares in June.
PB Fintech has allotted 75,760 equity shares to eligible employees under its ESOP 2021 scheme, as approved by the board on September 4, 2024. With a face value of INR 2 each, this allotment has raised the company's paid-up equity capital to INR 91.22 crore.
Based on the stock's opening price of INR 1,720.05 on September 5, the newly allotted shares are valued at INR 13.03 crore. Earlier in June, PB Fintech had allotted 48.3 lakh shares under its ESOP plan.
This is the age of ESOPs. Month after month, more founders are relying on ESOPs to attract and retain top employees. There is an increasing trend among technology start-ups for employee stock option plans (ESOPs), with expectations that this growth will persist into the future.
As we await what the future holds, one thing is sure, with a piece of the growth pie of a company, employees are definitely more interested and involved in the company’s success and better off financially.
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