Godrej Group stocks drop up to 7% as family agrees on formal division plan
Upstox
2 min read • Updated: May 2, 2024, 12:13 PM
Summary
On April 30, the founding family of the Godrej Group announced that it had reached an agreement to split the conglomerate into two branches. The operations will be divided into two distinct entities – Godrej Enterprises and Godrej Industries.
Shares of the five listed Godrej companies took a hit on Thursday, May 2, after the Godej family announced an ownership realignment of their shareholdings in the group firms.
Godrej Industries Ltd dropped as much as 6.95% to hit an intra-day low of ₹ 893.8 apiece on the National Stock Exchange of India (NSE) on Thursday. Interestingly, the stock had jumped 3% as soon as the session opened but gradually corrected to hit the day’s low.
Godrej Consumer Products Ltd also pared gains to trade just around 0.5% higher at ₹1,225.35 apiece. Earlier in the opening session, the stock had risen as much as 2.9%.
Godrej Properties Ltd slipped 4.4% to hit the day’s low of ₹2,531.35 apiece on the NSE. Godrej Agrovet, which had earlier jumped as much as 6% in the opening session, later trimmed gains to trade just 1.6% higher at ₹552.65 apiece.
The sharpest reversal was seen in the Astec LifeSciences Ltd stock. The share price was up around 9.5% at one point in the opening session on Thursday. However, it tumbled later to trade almost flat at ₹1,285.05 apiece compared with its previous close of ₹1,284.4.
On April 30, the founding family of the Godrej Group announced that it had reached an agreement to split the conglomerate into two branches. The operations will be divided into two distinct entities – Godrej Enterprises and Godrej Industries.
Godrej Industries Group (GIG), which includes all the listed companies, will have Nadir Godrej as chairperson and will be controlled by Adi Godrej, Nadir Godrej and their immediate families.
Pirojsha Godrej will be the executive vice chairperson of GIG and will succeed Nadir Godrej as the chairperson in August 2026.
Godrej Enterprises Group (GEG), which comprises Godrej and Boyce (G&B) and its affiliates, will now be controlled by Jamshyd Godrej, Nyrika Holkar and their immediate families.
The realignment will be implemented after the relevant regulatory approvals have been obtained, the group said in a statement issued on Tuesday.
As part of the restructuring, Adi and Nadir's family will make an open offer to the shareholders of Astec Lifesciences. The floor price of the open offer has been fixed at ₹1,069.75 per share, which is at a 17% discount to its previous close.