ITC - ROCE To See Sharp Jump Post Long-Awaited Hotel Demerger: Systematix

"BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Systematix Research Report.ITC Ltd.'s management has proposed the long-awaited demerger of its hotel business into a new separately listed entity. Under the demerger scheme, ITC would hold a stake of 40% and the balance 60% will be held by company’s shareholders proportionate to their shareholding in the company. The hotel business has been a cash-guzzler for ITC contributing only about 4% to revenue and 3% to ITC’s Ebitda in FY23 with 22% contribution to its capital employed resulting in single-digit return on capital employed. With the new company now becoming an associate company for ITC, it would drive a significant 18-20% jump in ROCE and ~10% jump in return on invested capital for the company. The transaction is expected to be tax-neutral with stamp duty cost not having a material bearing on the transaction. A royalty structure will be worked out based on relevant industry benchmarks at a later date..Click on the attachment to read the full report:.ITC's Hotel Business Demerger To Improve Return On Capital, Say Analysts.DISCLAIMERThis report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime..Users have no license to copy, modify, or distribute the content without permission of the Original Owner."

ITC - ROCE To See Sharp Jump Post Long-Awaited Hotel Demerger: Systematix

Under the demerger scheme, ITC would hold a stake of 40% and the balance 60% will be held by company’s shareholders.

NDTV Profit

NDTV Profit

Follow Us

DOWNLOAD THE APP

ITC - ROCE To See Sharp Jump Post Long-Awaited Hotel Demerger: Systematix

Under the demerger scheme, ITC would hold a stake of 40% and the balance 60% will be held by company’s shareholders.

Choose a plan

Follow Us

DOWNLOAD THE APP