Following the Godrej family’s agreement to divide the conglomerate into two sections, Godrej Group stocks, which include Godrej Industries, Godrej Consumer Products, and Godrej Agrovet, surged more than 1% to 5% in early trade on Thursday.
Godrej Consumer Products saw a 2.8% increase in share price, Godrej Agrovet saw a 5.5% increase in share price, and Godrej Industries saw a 3% increase in price to reach a new 52-week high of ₹989.90 per share on the BSE. However, in early trading on May 2, the price of Godrej Properties’ shares fell by more than 4.4%.
Adi Godrej and brother Nadir Godrej will maintain the listed companies, according the Family Settlement Agreement that the company posted on the stock exchanges. The families of Jamshyd Godrej and Smita Crishna, siblings, will receive the unlisted company Godrej & Boyce Mfg. Co. Ltd. The company’s interests span a variety of industries, including IT, furniture, software, engines and motors, construction, aerospace, aviation, and defense. It will fall within the Godrej Enterprises Group’s purview.
Family members’ stakes in various enterprises will be reorganized to match the businesses they inherited. The Godrej brand will be used by both groups going forward. The deal also covers the development of land banks, brand usage, and royalty.
“The realignment has been arrived at in a respectful and mindful way to maintain harmony and to better align ownership in acknowledgement of the differing visions of the Godrej family members. This will help maximize strategic direction, focus, agility, and will accelerate the process of creating long-term value for shareholders and all other stakeholders,” the company statement on April 30 said.
Following the acquisition of the necessary regulatory clearances, the realignment will be put into effect.
