ITC‘s share price jumped up sharply in the late hours of trading on Thursday after the company announced that its shareholders had voted in favour of the demerger.
What Happened: As per an exchange filing, around 99.6%of shareholders voted in favour of the demerger, while just 0.4% voted against it. 99.6% of institutional shareholders voted in favour, while 98.48% of public shareholders voted in favour. Institutional Investor Advisory Services (IiAS) had advised the shareholders of ITC to vote against the proposed demerger.
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The approval follows an order by the National Company Law Tribunal (NCLT) to convene a meeting of the company’s ordinary shareholders. Once the demerger process is completed, pending other regulatory approvals, ITC Hotels is likely to get listed later this year.
Under the scheme of arrangement approved in August last year, shareholders of ITC will receive 1 share in the demerged hotels business for every 10 shares held in the parent company. Post-listing, ITC will retain a 40% stake in the hotel business, with the remaining 60% held by the conglomerate’s shareholders.
In the January-March quarter, ITC reported a net profit decline of 1.31% year-on-year to ₹5,020 crore, while revenue modestly increased by 1.4% YoY to ₹17,752 crore.
Price Action: ITC’s share price was up 1.19% to close at ₹435.40 on Thursday.
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