ITC Demerger: Cigarettes-to-hotels giant's stock gains after shareholders approve demerger plan

ITC Demerger latest news, ITC share price today NSE: ITC, a cigarette-to-hotel conglomerate shares hogged the limelight on Thursday, June 6 after ITC's board shareholders approved the proposed demerger of its hotels business today. As many as 99.6 per cent of shareholders gave the nod to the demerger plan. ITC shares closed near the day's high at Rs 436.4, up 1.42 per cent on NSE.

".....for approval of the Scheme of Arrangement amongst ITC Limited and ITC Hotels Limited and their respective shareholders and creditors for the proposed demerger of the Hotels Business of ITC Limited into ITC Hotels Limited, as set out in the Notice dated 30th April, 2024, has been passed by the Members by requisite majority, pursuant to Section 230(6) of the Companies Act, 2013," read the company's filing. 

Earlier, ITC informed through a regulatory filing dated 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 business. 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 will shareholders get after the demerger?

Following the demerger, shareholders of ITC will get one share in the hotel company for every 10 shares held in ITC. 

ITC shareholders will receive 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 Q4 Results 2024: How did the FMCG giant fare in Q4?

FMCG giant ITC posted operationally mixed fourth-quarter results, as its standalone margin, EBIDTA and profit after tax (PAT) slipped Year-on-Year (YoY) in the quarter under review. There was a slight jump in its revenue from operations YoY.

ITC's standalone revenue from operations went up by 1.1 per cent to Rs 16,579.3 crore in the quarter under review from Rs 16,398.0 crore in the same quarter last fiscal. Its PAT was also down by 1.30 per cent to Rs 5,020.20 crore from Rs 5,086.90 crore YoY. Read more

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