Arvind Ltd., India’s leading textile and branded apparel major player, has announced its decision to demerge its branded apparel and engineering businesses from the parent company.
Post demerger, the branded apparel business will be called Arvind Fashions Ltd. and the engineering business would be named Anup Engineering Ltd. Shareholders of Arvind Limited will be entitled to one equity share of Arvind Fashions for every five shares held by them and to one equity share of Anup Engineering Ltd. for 27 shares held.
On completion of the process, both companies will be listed on the BSE and NSE.
Diverse businesses
Sanjay Lalbhai, chairman and managing director of Arvind Ltd., said: “In the last few years, Arvind has nurtured a diverse set of businesses. Two years ago, we demerged Arvind Smart Spaces as an independent company, and its performance has exceeded expectations.”
“Arvind Fashions and Anup Engineering will now also pursue their independent courses. Arvind Fashions has already demonstrated an industry-leading track record in the branded apparel and accessory space. Anup has demonstrated an impeccable trajectory on customer delight, topline growth and profitability. Financial independence will help unlock the full potential of these businesses.”
He said the demerger would enable the company to focus on its core textiles business. The company would invest ₹1,500 crore in the next three to four years to transform the textile business.
“This focus will not only enable us to grow at an accelerated pace, but also drive better return on investments and build a business model that is future-ready,” he added.
Soon after the announcement, the company’s stock faced selling pressure and closed with a loss of 9.11% at ₹413.50 on the BSE.
