Jefferies, a global stockbroker, anticipates large withdrawals from ITC Hotels due to ETF sales. “ITC Ltd is part of key indices, ITCH could see outflows to the tune of $190-200 million (based on stock price) related to ETF selling in the stock,” Jefferies noted in their most recent analysis on the recently listed firm.
On January 29, ITC Hotels went public on the BSE at Rs 188 and the NSE at Rs 180. However, it lost intraday trading gains and ended the day close to its lows at Rs 178 on the BSE. About Rs 39,000 crore is the initial market capitalization of ITC Hotels.
“British American Tobacco (BAT) will hold ~15% of the demerged Hotel entity (it has 25% stake in ITC Ltd.),” Jefferies said, adding that BAT is expected to sell some of its stake in ITC’s demerged hotel sector. Earlier on October 24, BAT’s management had stated that it had no plans to own stock in ITC hotels in India and would sell its holding when appropriate.
A Scheme of Arrangement authorized by the NCLT was used to carry out the demerger of ITC’s hotel industry. About 60% of ITC Hotels’ stock was distributed directly to ITC shareholders under this arrangement, following their ITC holdings. Additionally, the parent business, ITC, kept the remaining about 40% of the demerged corporation. The demerger ratio was fixed at 1:10, meaning that for every ten shares of ITC, the stockholders received one share of ITC Hotels.
ITC and ITC Hotels had a demerger ratio of 1:10. In an exchange statement, the business said, “The Board of Directors of ITC Hotels has allotted 125,11,71,040 equity shares of Rs 1/- each to the shareholders of the company as on the record date, January 6, 2025.” Shareholders who applied for the allocation by January 3rd or earlier were eligible to receive shares.
ITC Hotels, a well-known brand in India’s hotel industry, was founded in 1975 and operates in more than 90 sites. Throughout the nation, it runs around 140 hotels.
