FMCG major ITC may get shareholders approval on June 6 for hotels business demerger
On August 14, the board of ITC approved the demerger of its hotel businesses and to list a new entity. However, the hotels will operate under the ITC brand.
Fast-moving consumer goods (FMCG) major ITC Ltd shared its financial results for the fourth and last quarter (March 2024) of fiscal 2024 today, May 23, 2024, through a stock market disclosure. The tobacco maker's PAT was down by 1.30 per cent to Rs 5,020.20 crore in the March quarter of FY24 from Rs 5,086.90 crore YoY. However, ITC's standalone revenue from operations went up by 1.1 per cent to Rs 16,579.3 crore in Q4FY24 from Rs 16,398.0 crore in the same quarter in FY23.
ITC also informed on May 23 that after receiving 'no objections' from stock exchanges, the National Firm Law Tribunal (NCLT) has authorised the firm to call a shareholder meeting on June 6, 2024, to examine and approve the planned demerger of its hotel operations.
On August 14, the board of ITC approved the demerger of its hotel businesses and to list a new entity. However, the hotels will conitiue to hold ITC license and to oprate under the same brand name.
The board had said that it has considered and approved the demerger of the hotel business under a scheme of arrangement amongst ITC and ITC Hotels and their respective shareholders and creditors under Sections 230-232 and other applicable provisions of the Companies Act, 2013.
What shareholders to get after demerger
Under the demerger, shareholders of ITC will get one share in the hotel company for every 10 shares held in ITC. ITC stockholders will own about 60 per cent direct equity in ITC Hotels (in proportion to their holding in ITC), with the other 40 per cent stake staying with ITC. There is no monetary consideration due under the demerger process.
ITC dividend
The FMCG company also announced recommended a final dividend of Rs 7.5 of 750% per equity share of the face value of Re 1 each today alongwith its Q4FY24 results.
The company has also informed exchanges that it has fixed June 4 as the record date to identify the eligible shareholders for this corporate action.
According to the exchange filing, if the final dividend is declared it will paid to eligible shareholders between July 29, 2024, and July 31, 2024.
On BSE, ITC shares closed at Rs 441.2 each, up 0.33 per cent on Thursday, May 23.
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