On January 22, the Board adopted an arrangement that allowed Hindustan Unilever (HUL) to decomming its ice cream business. While releasing its quarterly results for the third quarter of FY25, the FMCG giant revealed the demerger. The company will separately list Kwality Walls (India), which was incorporated on January 10, 2025.
Shares of the new company will be distributed at a 1:1 ratio to investors who currently own HUL shares. This implies that current shareholders will receive more shares of the company that has merged.
HUL claims that it’s a fantastic company with enormous room for expansion. According to the investor presentation, it has given management more flexibility to implement tactics that are appropriate for Ice Cream’s unique business model. Additionally, it stated that Kwality Walls (India) possesses the portfolio, brand, and innovation know-how of Unilever, the biggest ice cream manufacturer in the world.
HUL declared in the second quarter of FY25 that its Board had approved the demerger of the ice cream company into a distinct listed company in principle. “After giving careful thought to various ways to split up the ice cream business, the Board has given its in-principle approval to demerge the business to maximize value for all shareholders,” the company stated.
Additionally, for an enterprise value of Rs 2,955 crore, HUL purchased a 90% share in Minimalist. In 2020, Mohit and Rahul Yadav launched this beauty brand. The business stated that it would purchase the remaining 9.5% within two more years. Minimalist has been successful since its founding and generates around Rs 500 crore in sales annually.
The corporation did, however, issue a warning that the consumption demand would likely stay modest shortly. HUL stated that a low-single-digit price rise is anticipated if commodity prices stay the same.
