ITC Demerges Hotel Business With Effect From Jan 1, 2025

Kolkata-based business conglomerate ITC Limited is set to demerge its hotel business from January 1 2025. The company received a go-ahead from the Kolkata bench of the National Company Law Tribunal (NCLT) to approve the demerger between ITC Limited and ITC Hotels Limited.

In a regulatory filing the company said, “We further advise that ITC Limited and ITC Hotels Limited have mutually acknowledged that all the conditions specified in Clause 28 of the Scheme have been fulfilled and satisfied, including filing of the aforesaid Order with the Registrar of Companies, West Bengal, and accordingly, the Appointed Date and the Effective Date of the Scheme shall be the first day of the following month i.e. 1st January, 2025, in accordance with Clauses 5.1(iii) and 5.1(xvi) of the Scheme, respectively.”

After filing a certified copy of the NCLT order with the Registrar of Companies, West Bengal and fulfilling various conditions, the demerger will remain effective from the first day of following month.

ITC has indicated that its hotel business has matured and is ready to traverse its path as a separate entity by keeping a focused business approach while maintaining an optimal capital structure.

The company announced to demerge its hotel business in August 2023. If everything goes according to the plan, ITC will hold 40% stake in ITC Hotels, while the remaining will be acquired by the ITC shareholders.

During the second quarter, ITC Hotels reported a revenue growth of 12.1% YoY. EBITDA margin surged 70 bps YoY, buoyed by higher RevPAR (Revenue per available room). Shares of ITC are trading at ₹473.65, up 0.76% today.