The board of directors of ITC Limited has approved the demerger of its hotels business into a separate company, ITC Hotels Limited. The share entitlement ratio for the demerged hotels business has been fixed at 1:10, which means that for every 10 shares of ITC Limited held by a shareholder, he/she will be eligible to receive 1 share of ITC Hotels Limited.
The demerger is expected to be completed by the end of the financial year 2023-24. ITC Hotels Limited will be listed on the stock exchanges after the demerger is completed.
The demerger of the hotels business is part of ITC Limited's strategy to focus on its core businesses of cigarettes, foods, and paper. The company believes that the demerger will allow it to unlock the value of its hotels business and to focus on its long-term growth plans.
The demerger is also expected to benefit ITC Hotels Limited by giving it greater flexibility to raise capital and to pursue strategic acquisitions. The company plans to use the proceeds from the demerger to expand its hotel portfolio and to upgrade its existing hotels.
The demerger of the hotels business is a positive development for ITC Limited and for ITC Hotels Limited. It is a sign that ITC Limited is committed to its long-term growth plans and that it is confident in the future of its hotels business.
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