Grandfather’s hidden 500 L&T shares multiply, turn Bengaluru woman into instant crorepati, but…

The year was 2004. In India’s financial capital, Mumbai, Priya Sharma’s businessman grandfather had decided to invest part of his earnings into the stock market.

He went for a safe bet, purchasing 500 shares of the blue-chip construction major, Larsen and Toubro (L&T).

He seems to have not meddled with this investments too much. They lay dormant, almost forgotten for many years.

Then, following his death, the complexities of estate settlements left these assets actually forgotten and untouched.

Time passed, as it does. The value of the investment in L&T stocks continued to grow. As did the investor’s granddaughter Priya, who was living in Bengaluru.

And just like that, the year 2020 came around: the pandemic-induced stay-at-home era.

Forgotten fortune resurfaces

Priya, while sifting through her grandfather’s will, stumbled upon the neglected shares. It was about to be life-changing.

She hadn’t inherited 500 L&T shares. Due to stock splits and bonus shares, she would received 4,500 stocks.

The number of L&T stocks had grown from 500 in 2004 to 4,500 in 2020. Pixabay

A stock split occurs when a company increases its number of outstanding shares to boost liquidity. For instance, in a 1:2 split, each share is divided into two, effectively doubling the shareholder’s count without changing the investment’s value.

Bonus shares, on the other hand, are additional shares given to existing shareholders at no extra cost, based on the number of shares already owned.

The increase in the number of L&T shares from 500 to 4,500 was nine-fold, but their value had grown exponentially.

The stocks were valued at around Rs 1.72 crore ($2.05 million at the current exchange rate of 83.8).

Overnight, Priya Sharma became a crorepati– a millionaire. Or so she thought.

The challenges to claiming the inheritance

Reclaiming this hitherto forgotten fortune was not straightforward.

Residing in Bangalore, Priya faced significant challenges in accessing her grandfather’s documents and starting the probate process in Mumbai. Probate is the legal procedure required to validate someone’s will and claim the inheritance.

Priya would have to submit a lot of documents to reclaim the L&T shares. Image used for representative purpose/AP

Without the original share certificates and amid operational hurdles, Priya’s path to reclaiming her rightful inheritance seemed demanding.

Still, to start off the process, she wrote to Larsen & Toubro. The company in turn asked her to complete multiple bureaucratic formalities. It didn’t take long for her to realise she needed expert assistance.

This is where Share Samadhan, a firm specialising in recovering lost investments, came in.

The firm carefully reviewed Priya’s documents, including her grandfather’s will. The task was tough.

“We came to know that since the number of shares were substantial and client did not have original shares in possession, it was going to be a tough task since company will do multiple verifications. Further probate of will was also required to be done,” Share Samadhan told Firstpost.

Securing the probate

The company and Priya got to the task quickly. Obtaining a probate of the will was the first, and perhaps most essential task. Probate is the judicial process wherein a will is “proved” in a court and accepted as a valid public document that is the true last testament of the deceased.

To secure the probate in Mumbai, the company and Priya’s legal advisor liaisoned with L&T to update Priya’s KYC (Know Your Customer) information and obtain a detailed shareholding statement necessary for the probate.

The paperwork for the probate of the will had to be done in Mumbai. PTI

With the probate secured, the next challenge was to meet L&T’s stringent requirements.

Meeting L&T’s documentation requirements

The company identified a discrepancy between the name on the share certificate and Priya’s grandfather’s official documents. An affidavit was needed to resolve this discrepancy.

Additionally, L&T required someone to stand as a financial surety and sign a surety bond for the issuance of duplicate shares, since the value of the shares was quite high.

Finding a surety

A surety is a person who takes responsibility for another’s performance of an undertaking, here ensuring that the duplicate shares would be used legitimately.

Finding a surety was difficult, especially since L&T insisted the surety not be a blood relative. Eventually, Priya managed to secure a distant relative to fulfill this role.

Negotiations happened, the necessary documentation was provided, and L&T also demanded an in-person verification (to prevent fraudulent claims) was met.

At last, after nearly a year of persistent effort, Priya secured a duplicate certificate from L&T, reclaiming her grandfather’s forgotten fortune.

She was now, truly, a millionaire.

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