As part of the demerger plan, ITC has chosen to keep a 40% stake with itself and give the rest to existing shareholders. The share ratio would be finalised by the ITC board at its meeting on August 14. Investors are also expecting that the spin-off of the hotels business is the first step after which other non-cigarette businesses could also be demerged.
As a standalone company, the hotels business should command a similar valuation to that of the leading listed hotels firm, Indian Hotels, and the combined value of the two entities will likely exceed ITC’s current market cap