ITC Board accords in-principle approval to demerge hotels business into a new entity

and sustained value creation as also enable leveraging of cross synergies between the Company and the new entity.

New Delhi, July 24 (IANS) currently stands at Rs 12.75 trillion as compared to Rs 13.3 trillion a year ago.

Earnings upgrade in the last one year are emanating from domestic cyclicals, internet stocks while the downgrades are driven by defensives and commodities, ICICI Securities said in a report. Bulk of the earnings upgrade over the past one year has been driven by stocks related to domestic cyclical demand (financials, consumer discretionary, auto, tobacco, industrials) and internet stocks.

On the flip side, bulk of the downgrades was driven by stocks related to defensive sectors (IT, healthcare, staples) and commodities (metals, cement).

The 4 per cent downgrade to aggregate profit pool appears reasonable given the shocks such as the massive QT cycle, RussiaUkraine war and banking crisis in DMs, the report said.

Also, the bulk of earnings upgrades over the past one year have been driven by domestic cyclicals and internet stocks.

Overall, the market cap of the 600 stocks rose by 28 per cent over the last one year to reach Rs 275 trillion with bulk of market cap expansion happening over the past three months.

The rapid expansion in market cap over the recent past is likely due to a sharp decline in ‘equity risk premium’ and benign ‘riskfree rate’ environment.

New Delhi, July 24 (IANS)

The Board of Directors of ITC Limited on Monday evaluated and discussed various alternative structures for the Hotels Business towards crafting the next horizon of growth as also enhancing value creation for all stakeholders.

In the meeting, the Board noted that the Company's Hotels Business has matured over the years and is well poised to chart its own growth path as a separate entity in the fast- growing hospitality industry with sharper focus on the business and an optimal capital structure, whilst continuing to leverage ITC's institutional strengths, brand equity and goodwill.

After due consideration, the Board accorded its in-principle approval to the demerger of the Hotels Business under a scheme of arrangement; with the Company holding a stake of about 40 per cent in the new entity and the balance shareholding of about 60 per cent to be held directly by the company's shareholders proportionate to their shareholding in the Company.

The proposed reorganisation would ensure continued interest of the Company in the hospitality business, provide long term stability and strategic support to the new entity in its pursuit of accelerating growth

The demerger will help the new entity in attracting appropriate investors and strategic partners/ collaborations whose investment strategies and risk profiles are aligned more sharply with the hospitality industry. In addition, it will unlock value of the Hotels Business for the Company’s shareholders by providing them a direct stake in the new entity along with an independent market driven valuation thereof.

This move by the Company also reinforces the sharper capital allocation strategy put in place in recent years, manifest in the pivot to ‘asset-right’ strategy in the Hotels Business.

Details of the proposed reorganisation, including the scheme of arrangement, shall be placed for approval of the Board at its meeting to be convened on August 14, 2023.

To progress the proposed reorganisation as aforesaid, the Board has also approved incorporation of a wholly owned subsidiary of the Company, to be named ITC Hotels Limited or such other name as may be approved by the Ministry of Corporate Affairs.

Over the last two decades or so, ITC’s Hotels Business has scaled up significantly in terms of room inventory, Revenue and Profits, and has established itself as a pioneer in green hoteliering anchored on its ‘Responsible Luxury’ ethos. Today, with over 120 hotels and 11,600 keys across 70+ locations, the ITC Hotels group is renowned for its world-class properties, iconic cuisine brands and unparalleled service standards. The Business today ranks amongst the fastest growing hospitality chains in the country with marquee brands viz., ‘ITC Hotels’ in the Luxury segment, ‘Welcomhotel’ in the Premium segment, ‘Fortune’ in the Mid-market to Upper-upscale segment and ‘WelcomHeritage’ in the Leisure & Heritage segment. Having achieved considerable scale and market standing, the Business in 2017 pivoted to an ‘asset-right’ strategy which envisages a substantial part of incremental room additions to accrue through management contracts.

Accordingly, two new brands, ‘Mementos’ in the Luxury Lifestyle segment and ‘Storii’ in the Premium segment, have also been launched recently to offer varied experiences to new age travelers.

After 2 years of pandemicled disruptions, the Indian hospitality industry has bounced back strongly with significant improvement in room rate and occupancy.

ITC’s Hotels Business has also emerged stronger and has delivered robust growth and margin expansion in FY 2022-23 and is well poised to sustain the growth momentum.

The Indian Hospitality industry is expected to witness rapid growth going forward. The key drivers of growth include the strong macroeconomic fundamentals and growth prospects of the Indian economy, increasing affluence and favourable demographic profile of India’s population, Government of India’s thrust on the

"Given the nature of the economic recovery in India, which is led by growth in ‘gross fixed capital formation’ or capex cycle, we expect the earnings upgrade cycle to continue for domestic cyclicals," ICICI Securities said. Global economic environment continues to be uncertain and could weigh on earnings revision of the stocks related to global economy.

The aggregate profit pool estimate of 600 stocks for FY24

Top stocks that have witnessed maximum consensus upgrades over the last one year belong to domestic cyclical sectors such as financials, consumer discretionary, auto, industrials and internet stocks.

Top stocks that have witnessed the maximum consensus downgrades are related to defensive sectors (IT, healthcare, consumer, telecom) and commodities (metals, cement), the report said.

(Sanjeev Sharma can be reached at sanjeev.s@ians.in)

Gurugram, July 24 (IANS) Adolescence is a time when youngsters undergo significant physical, emotional, and cognitive changes. These changes can be overwhelming or even traumatic for some impacting their mental health and the development of their personality and well-being in the future.

To help these children successfully navigate these crucial years of their lives, GD Goenka University in collaboration with Fortis Mental Health Programme organised a "National School Counselor's Summit on Risk Management, called VARTAH". The two-day summit 'VARTAH' which stands for "ValuesAwareness - Reform - Thrive - Action - Hope" was focused on managing risky behaviours in school children. The initiative aims at nurturing a positive mental health culture within educational ecosystems. It provides a platform to raise awareness, advocate positive changes, and initiate measures to promote the well-being of children and adolescents.

School counsellors and educators across the country will have the opportunity to participate in it. Emphasising the need to include mental health and well-being in the academic curriculum, Dr Samir Parikh, Chairperson, Fortis National Mental Health Program said: "Empowering children in their formative years with skills for life that help them navigate through ups and downs with confidence, self-belief and resilience is essential, that takes them on their paths of success, can have meaningful relationships and contribute to the society." He stressed that promoting mental health among adolescents requires different roles from society, parents, and the media. It is not the responsibility of any one party alone, and change can only come when everyone works collectively.

Dr Parikh also spoke about the need to promote the concept of Psychological First Aid (PFA). Addressing the gathering, he said: "We all talk about physical first aid, but nobody mentions psychological first aid.