Godrej Industries, Godrej Properties share decline up to 7% after conglomerate's split

Under the new arrangement, Godrej Enterprises will be headed by 75-year-old Jamshyd Godrej as chairperson and managing director and his niece Nyrika Holkar as executive director.

Nadir Godrej, 73, will serve as chairperson of Godrej Industries, which operates through listed companies including Godrej Industries, Godrej Consumer Products, Godrej Properties, Godrej Agrovet and Astec Lifesciences. GIG will be controlled by Nadir's brother Adi Godrej and their immediate family.

82-year-old Adi Godrej stepped down as chairman of Godrej Industries in August 2021, handing over the reign to his brother, Nadir Godrej.

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.

As part of the restructuring, Adi and Nadir's family will also extend an open offer to the shareholders of Astec Lifesciences. The announcement of the open offer drove shares of Astec Lifesciences significantly higher, marking the stock's most substantial gains among all Godrej group companies.

The floor price of the open offer has been set at Rs 1,069.75 per share, representing a 17% discount to the previous closing price of Rs 1,287. Through this open offer, which was triggered under SEBI regulations post the settlement, Adi and Nadir's family will seek to acquire a 26% stake in Astec for a total of Rs 545.46 crore.

Meanwhile, the conglomerate also stated that the Godrej trademark will be equally owned and shared by both family groups.

At 11:21 am, shares of Godrej Properties and Godrej Industries were trading 5.8% and 8.7% lower, respectively. Conversely, Godrej Consumer and Godrej Agrovet shares were trading 1% and 2.3% higher, respectively.

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