ITC shares dip 1% ahead of hotel business demerger record date

What will happen on January 6?

On Monday, January 6, ITC shareholders who hold stock in the company as of January 3, will receive 1 share of ITC Hotel for every 10 shares of ITC they hold, i.e., at a 1:10 ratio.

ITC Hotel will be listed on the NSE and the BSE on Monday in a dummy avatar to reduce the impact of the demerger on the overall market. This means that shareholders will not be able to trade in the shares of the newly demerged entity for a few weeks until its official listing.

The demerged entity will receive ₹1,500 crore in cash and cash equivalent at the time of the demerger.

Approved by its board in August 2023, the demerger of ITC’s hotel business to ITC Hotels came into effect on January 1.

Past performance

The scrip was trading at an intraday low of ₹479.85, slipping 1.88% on the National Stock Exchange (NSE) on Friday.

The stock was up by 0.83% over the past five days and rose 2.41% over the past month.

ITC surged 12.99% over the last six months and climbed 0.13% on a year-to-date basis.

About ITC

Initially incorporated as a tobacco trader, ITC is a diversified conglomerate based in Kolkata with businesses spanning various verticals, including FMCG, hotels, packaging, agri-business and IT.

Now, it is demerging its hotel business.

Its hotels vertical, ITC Hotel was incorporated in 1974 and has over 140 hotels to date across 90-plus locations.

ITC has a total market cap of ₹6.06 lakh crore as of January 3, 2025, according to the NSE.