ITC Hotels Ltd will be delisted from 30-share BSE Sensex, and 22 other indices of BSE, with its deletion effective February 5, 2025, at trading opening, in view of its recently completed demerger with ITC Ltd., for a re-alignment in a variety of stock indices.
According to an official statement, ITC Hotels’ delisting was triggered as it did not drop below its lower circuit during trading till closing bell. As a result, the stock was delisted from all BSE indices at opening for trading in Wednesday’s session.
Index Funds Offload Shares Post-Exclusion
With ITC Hotels’ removal from Sensex, index funds holding its shares were forced to rebalance their portfolios, leading to significant sell-offs.
- Index funds sold shares worth over ₹400 crore following its exclusion from the Sensex.
- Additional selling of ₹700 crore is anticipated upon its removal from the NSE Nifty 50.
Despite this, ITC Hotels’ stock remained resilient, trading 1.3% higher at ₹165.9 per share on the NSE at 9:40 AM, compared to the previous session’s closing price.
ITC Hotels’ Market Debut and Demerger Details
ITC Hotels shares were listed on January 29 without an IPO.
- Listing Price on NSE: ₹180 per share
- Listing Price on BSE: ₹188 per share
- Implied Price Before Listing: ₹260 per share
- Discount at NSE Listing: Nearly 31% below the implied price
The listing followed the demerger of ITC Hotels from its parent company, ITC Ltd., a strategic move aimed at unlocking shareholder value. The demerger was structured to directly issue equity shares of ITC Hotels to existing ITC shareholders.
Demerger Ratio and Shareholding Structure
ITC Ltd. had announced the demerger plan last year, with the following share distribution ratio:
- For every 10 shares of ITC Ltd. held (as of January 6, 2025), investors received 1 share of ITC Hotels.
Post-demerger, the ownership structure of ITC Hotels is as follows:
- 60% stake is now directly held by ITC shareholders, proportionate to their shareholding in ITC Ltd.
- 40% stake remains under ITC Ltd.
The move is expected to help ITC Hotels grow independently in the hospitality sector while allowing ITC Ltd. to focus on its core businesses, including FMCG, tobacco, and agribusiness.
Do you have a news tip for Lakshmishree reporters? Please email us at media@lakshmishree.com
News Desk
