Demerged ITC Hotels stock could get listed at Rs 150-175, says Nuvama; Nomura pegs range at Rs 200-300

Demerged ITC Hotels stock could get listed at Rs 150-175, says Nuvama; Nomura pegs range at Rs 200-300

The much-anticipated listing of ITC Hotels, demerged from ITC Ltd, is set to occur during a special pre-open session on January 6, with market analysts predicting a listing price in the range of Rs 150 to Rs 300 per share.

The price discovery will be based on the difference between ITC Ltd’s closing price on January 3 and the opening price determined during the pre-open session on January 6. On Friday, ITC shares closed at Rs 483.95, down 1.04 percent on the NSE.

Brokerage firm Nuvama has projected that ITC Hotels shares could be valued between Rs 150 and Rs 175 per share at listing. ITC's share price is expected to be adjusted by Rs 22-25 on the ex-date, reflecting its 40 percent stake in the hotel business and incorporating a 20 percent holding discount, as per Nuvama.

In contrast, Japanese brokerage Nomura has issued a more optimistic estimate, pegging the likely listing range at Rs 200-300 per share. This projection translates to a market capitalisation of Rs 42,500 crore to Rs 62,200 crore for ITC Hotels, underscoring its potential as a standalone entity.

“Post-listing, ITC Hotels is expected to command a premium valuation due to better price discovery in the market,” Nuvama analysts noted. However, they cautioned about a potential supply overhang, with significant shareholders like BAT (15% stake) and SUTTI (5% stake) potentially exiting their positions.

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Under the scheme of demerger, ITC Hotels will issue equity shares directly to the shareholders of ITC in a manner that about 60 per cent stake is held directly by ITC shareholders proportionate to their shareholding in ITC and the remaining about 40 per cent stake to continue with ITC, it said.

Launched in 1975, ITC Hotels stands as one of India’s premier luxury hospitality brands. With a portfolio exceeding 140 hotels across 90-plus locations, it has carved a niche in the hospitality sector over nearly five decades.

The trading in ITC Hotels shares will commence after its formal listing on the stock exchanges. ITC Ltd has clarified that the listing process will be completed within 60 days from the receipt of the NCLT order on December 16, 2024.

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