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My advisory service for clients goes beyond mutual funds, stocks and insurance. I offer a service that most don't - which is to help them unlock value from shares and dividend warrants that they consider almost worthless because they simply don't know how to go about claiming what is rightfully theirs.
Dealing with physical shares and getting them dematerialized is very tedious work, with a lot of paper work, lots of correspondence and continuous follow up. But, at the end of the day, when you manage to unlock value in what clients considered worthless pieces of paper, the goodwill that you earn is tremendous, apart from of course the fees we earn for our efforts.
Ek dividend warrant ki keemat tum kya jaano
We are increasingly getting referrals from across the country and also from NRIs, for the specialist services we offer. In the beginning of 2016, I got a call from Mr. Ramesh from Canada saying he had got some OLD Dividend warrant of 1989 on 100 shares of a company and he was coming to India mid-February and wanted to see if that has some value. I told him to send a scanned copy of his dividend warrant so that I could in the mean-time have a look at it and give him details.
When we co -ordinated with the company for details, I was shocked that how can someone be so casual because his 100 original Shares had become 800 shares ( Including Bonus , Splits) and also a subsidiary of that company was listed in mid-2000 which also has a good rate. We spoke on Skype and he asked me if that company exists or does it have any Value.
I being a Bollywood Fan, told him in full filmy style, "Ek Dividend warrant Ki Keemat tum kya jaano Ramesh Babu!" He thought that there must be No or very Less Value and started laughing. But when I told him that Valuation is Rs.15.60 lakhs, he was stunned! He told me that he will visit my office as soon as he lands in Pune.
He had sold his old house and had not updated the Address, also out of 3 Holders, 1 holder had expired, Dividends were Unclaimed - you get the general picture. This is the story of so many investors across the country. They simply don't know how valuable these "worthless" pieces of paper have become over the years!
As usual my team had to work very hard , follow up with the registrars and the company to get the shares back from UNCLAIMED SUSPENSE a/c. and Credit it to His New Demat A/c which we opened. Finally, the entire project got over in 1 month time, and we were able to claim 7 years dividends also.
While leaving back for Canada, Mr. Ramesh asked me if we have printed any marketing material for our specialized service. I showed him our flyers he asked me for 200 flyers and told me that he will distribute in Canada in his locality as there are many Indians who still have shares and are unaware about it. Can you imagine a client asking you for flyers to distribute among his friends?
For us, it was another successful case closed, another happy client, another relationship forged.
Two big assignments in progress
Currently we are working on 2 complex assignments:
Where Client has expired and has shares in 45 traded companies. Legal heirs do not have any original share certificates - they have only dividend warrants. We have to get all these shares transmitted into legal heirs names along with issuing all duplicate shares. The second assignment is a family where there are 3 holders of shares. There are signature mis-match issues, there is an address change and all the resultant issues with that. The client has a huge holding in a single pharma company. In this case, we are arranging for an In-Person Verification to be done by the registrars and the company, to enable them to unlock huge value in these shares.
Of late, we have started getting a lot of enquiries about physical shares. After the change in rules & regulations and amendment of Companies Act 2015, the scenario has changed and many companies have also become active and aggressive in getting their shares converted into demat mode.
Consider these numbers
Did you know that companies spend approx. Rs. 3,500 - 5,000 p.a. on every shareholder who is still in physical mode?
Did you know that unclaimed dividends alone have now crossed Rs.1,100 crores, and that the total value of unclaimed shares and dividends is conservatively estimated at Rs. 2,000 crores?
Think of it - every IFA in the country must have at least a handful of clients who will have that old trunk filled with what they consider "worthless" pieces of paper - old share certificates, unclaimed dividends - mostly inherited, but never acted on. Each of these trunks and folders of "worthless" papers cumulatively is worth more than Rs.2,000 crores. As my client from Canada found out for himself, a single dividend warrant on 100 shares of 1 company managed to unlock for him over Rs. 15 lakhs of wealth he never imagined existed!
Let's work together
There is a huge opportunity for us to work together to help your clients unlock this kind of wealth that is lying somewhere in their cupboards. Let's work together to put a smile on your clients' faces - believe me, the joy of seeing the real worth of something they thought was worthless, is immense - perhaps much more than the appreciation they see in their portfolios. You can write to me at hiten@hitenshah.in
All content in Marketing Wiz is created by Wealth Forum and should not be construed as views of Kotak MF.
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