ITC Demerger: What Investors Need to Know

ITC Limited, one of India's leading conglomerates, has embarked on a strategic demerger of its hotel business. This move is expected to facilitate a significant value for shareholders, offering a clearer focus on the hospitality sector.

Here are a few important things you need to know about the upcoming event:

What is happening and when?

ITC Limited (ITC) is separating its hotel business into a new entity, ITC Hotels Limited (ITCHL), effective January 6, 2025.

• Record Date: January 6, 2025

(Record Date refers to the cut-off date on which the company finalizes the shareholders who are eligible for receiving the shares post demerger.)

Impact on Equity Shareholders:

• For every 10 shares of ITC Limited held as of January 6, 2025, shareholders will receive 1 share of ITC Hotels Limited. Please note that, no additional investment is required to receive these shares.
• After the demerger, equity shareholders will hold shares in two companies – ITC Limited and ITC Hotels Limited

Impact on MTF Shareholders:

• A special price discovery session will take place on January 6, 2025 from 9:00 AM to 10:00 AM.
• Buying and selling of ITC shares will not be permitted during the price discovery session.
• Squaring off of existing positions in ITC will be allowed after 10:00 AM on 6^th January.

Given the anticipated drop in ITC’s stock price investors are advised to maintain sufficient buffer margins to safeguard their positions.