Shares of Godrej Group companies rallied up to 9 per cent on the BSE in Thursday’s intra-day trade after the Godrej family on Tuesday announced an ownership realignment of their shareholdings in the Godrej Companies.
However, shares of Godrej Industries and Godrej Properties, dropped by up to 7 per cent in Thursday’s trading session on BSE
The family of 127-year-old Godrej Group, which has both, listed and unlisted entities, decided to split the conglomerate and operate as two entities — Godrej Enterprises and Godrej Industries. The conglomerate operates across aerospace, aviation, defence, and liquid engines among others.
According to the settlement plan, listed entities including Godrej Industries, Godrej Consumer Products, Godrej Properties, Godrej Agrovet and Astec Lifesciences will have Nadir Godrej as chairperson. In control, besides Nadir Godrej will be Adi Godrej, and their immediate family members.
Prima facie, analysts said the group arrived at an amicable agreement and there is a lot more clarity in the current restructuring now than what was speculated earlier.
“The restructuring takes off the confusion among investors and it is a welcome move. As time goes by, there will be more clarity among shareholders as the group has a complex structure that has legs in both the listed and unlisted market,” said Kranthi Bathini of Wealth Mills.
The conglomerate comprises five listed entities – Godrej Industries, Godrej Consumer Products, Godrej Properties, Godrej Agrovet, and Astec LifeSciences. Among these, Godrej Consumer Products stands as the largest, with a market capitalization of Rs 1.26 lakh crore as of April 30th.
The Adi/Nadir Godrej family has jointly with other family members/trusts offered to the shareholders of Astec Lifesciences to acquire an additional 26 per cent stake from the public as part of the family settlement agreement (FSA).
As per the company’s filing, the offer, made at the price of Rs 1,069.75 per share, was triggered as the Adi/Nadir family’s plan to acquire 20.84 per cent stake in Godrej Industries (GIL) from the Jamshyd Godrej/Smita Crishna Godrej family as per the FSA. The open offer, on full acceptance, will cost Rs 545 crore to the Adi/Nadir family. Godrej Industries indirectly holds shares in Astec LifeSciences, a subsidiary of Godrej Agrovet which owns 64.88 per cent in Astec.
Among individual stocks, Astech Lifesciences soared 9 per cent to Rs 1,400 on the BSE in intra-day trade. Godrej Agrovet surged 6 per cent to Rs 575 followed by Godrej Consumer Products (3 per cent to Rs 1,254) and Godrej Industries (1 per cent at Rs 989.90). At 09:44 am; these stocks were trading higher in the range of 1 per cent to 3 per cent. In comparison, the S&P BSE Sensex was up 0.26 per cent at 74,676.
At 12:21 pm, shares of Godrej Properties and Godrej Industries were trading 5.8 per cent and 8.7 per cent lower, respectively.
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