ITC shares end nearly 3 pc lower

     New Delhi, Jan 6 (PTI) ITC shares ended nearly 3 per cent lower, as the stock traded ex-demerger on Monday, after a special trading session to discover the price for ITC Hotels.
     The stock ended the day at Rs 442.50, down 2.75 per cent on the BSE. Earlier in the day, it had settled at Rs 455 after a special session.
     ITC shares ended at Rs 442.65, a decline of 2.84 per cent on the NSE. ITC shares had settled at Rs 455.60 on the NSE at the end of a special session earlier in the day.
     The company's market valuation stood at Rs 5,53,643.18 crore.
     Demerger of ITC's hotel business came into effect from January 1, 2025, and the record date for shareholders was January 6, 2025.
     As per the scheme, ITC Hotels is separated from the parent entity.
     "Most-awaited ITC demerger gets price discovery at Rs 455.60 and Rs 27 adjusted towards ITC Hotels based on previous closing during the special pre-open session. Discovery price of ITC Hotels was in-line with our expectations.
     "Now ITC shareholders get 1 share of ITC Hotels for every 10 held of ITC. As per the index demerger listing rules, ITC Hotels will be part of index and will be excluded from indices 3 business days after its listing date (if there are no circuit breakers).
     "ITC Hotels' demerger is expected to unlock substantial shareholder value and enable the newly-formed company to focus on growth in the luxury hospitality sector," Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd, said.
     The BSE and NSE conducted a special trading session to discover the price for ITC Hotels post demerger.
     As per the demerger scheme, ITC shareholders whose names will appear in the list of shareholders on January 6 will receive "one share of ITC Hotels for every 10 shares of ITC", according to a regulatory filing from the Kolkata-based conglomerate on December 31, 2024.
     "Overall, existing ITC shareholders will hold 100 per cent of ITC Hotels, i.e. about 60 per cent directly and a balance of about 40 per cent through their shareholding in ITC," it said.
     "ITC demerger is a strategic move to enhance business focus, operational efficiency, and shareholder value. Shareholders will benefit from ITC’s strength in FMCG and tobacco, while ITC Hotels pursues growth in hospitality as an independent entity, paving the way for sustainable value creation and promising futures for both companies," Satish Chandra Aluri, Analysts, Lemonn Markets Desk, said.
     A demerger is a restructuring strategy that separates a company's business units into independent entities, often called a spin-off or divestiture, Aluri explained.
     "It aims to streamline operations, unlock shareholder value, focus on core strengths, or adjust business objectives," he added.

(This story has not been edited by THE WEEK and is auto-generated from PTI)