The recent spinoff of ITC Ltd’s hotels division has garnered significant attention in the financial markets. As per the latest updates, the discovered price of ITC shares post the demerger stood at around ₹455 apiece on stock exchanges. This marks a significant adjustment following the separation of the hotels business from the conglomerate.
The demerger, which was approved by the Kolkata bench of the National Company Law Tribunal, has set the effective date as January 1, 2025. Shareholders of ITC Ltd are set to receive 1 share of ITC Hotels for every 10 shares held in the company. This move is expected to unlock substantial shareholder value and enable the newly-formed ITC Hotels entity to focus on growth in the luxury hospitality sector.
Analysts predict that the listing of ITC Hotels could take place on or before February 2025, with an expected price range of ₹100-125 per share. The new entity will have a strong zero debt balance sheet and plans to open one hotel per month for the next 24 months.
ITC Hotels will have a 40% stake held by ITC Ltd, with the remaining 60% owned by shareholders proportionate to their holdings in the conglomerate. The new entity aims to reach 200+ hotels and 18,000+ keys by 2030, with a revenue CAGR of 13.8% over the period of FY24-27.
Overall, the demerger of ITC Hotels from ITC Ltd is expected to streamline operations, drive growth in the hospitality sector, and create value for shareholders. With a strategic focus on the luxury hospitality segment, ITC Hotels aims to leverage its brand equity and goodwill to achieve sustainable growth in the coming years.
