ITC share price continues to fall for second day after hotel business demerger

• 25-Jul-2023
• 290

Ending months of speculation, cigarette-to-hotels major ITC on Monday announced that its board has approved the demerger of the hotels business. The move is aimed at unlocking value for 30 lakh shareholders of the multibagger stock which has been the best performing Nifty counter in the last one year "After due consideration, the Board accorded its in-principle approval to the demerger of Hotels Business under a scheme of arrangement, with the Company holding a stake of about 40% in the Following the announcement, ITC shares fell over 4% to Rs 468 on BSE as investors were left disappointed with the Kolkata-based FMCG company choosing to keep 40% stake with itself in the new subsidiary which will be called ITC Hotels. The demerger shall be placed for board approval on August 14 During a board meeting today, the directors evaluated various alternative structures for the hotel business towards crafting the next horizon of growth as also enhancing value creation for The proposed reorganisation would ensure the continued interest of the company in the hospitality business, provide long-term stability and strategic support to the new entity in its pursuit of accelerating growth and sustained value creation as also enable leveraging of cross synergies between the Company and the new entity