MUMBAI: The tobaccos to hotels and FMCG major ITC Thursday said an overwhelming majority of its shareholders—as much as 99.6 percent—approved the demerger of its hotels business which may eventually get listed.
The company informed the exchanges that as much as 99.6 percent of the shareholders voted in favour of the demerger, while just 0.4 percent voted against it.
"The resolution for approval of a scheme of arrangement amongst ITC and ITC Hotels and their respective shareholders and creditors passed notice dated April 30, 2024 through remote e-voting and e-voting," the filing said.
The decision sent its stocks rising by over 1.2 percent to Rs 435.50 at close after rallying to 437.80 intra-day, which came on the heels of a near 5 percent rally yesterday. But so far this year, the index heavy-weight is down over 5 percent as against 4 percent gain in the Nifty. It had hit 52-week high of Rs 499 July 24 last.
In the March quarter, ITC’s net profit declined 1.31 percent on-year to Rs 5,020 crore, while revenue rose modestly by 1.4 percent to Rs 17,752 crore as smuggled cigarettes continued to eat into its business. Despite this, the company declared a final dividend of Rs 7.50/share for the financial year 2024.
The earnings statement said the hotels segment had record high revenue and profit during the quarter, supported by strong room per revenue growth. Segmental revenue grew 15.6 percent to Rs 2,989 crore and operating profit jumped 26.2 percent to Rs 1,049 crore.
Earlier media reports said the proposed demerger was aimed at value unlocking and the hotels arm will be taken public at an appropriate time. But today’s filing was silent on this.