Shipping Corporation of India (SCI) rose 2.77% to Rs 115.15 after the company said it has received approval for demerger of its non-core assets.
The Ministry of Ports, Shipping and Waterways vide letter dated 16 September 2021 has approved SCI’s draft scheme of arrangement for the demerger of its non-core assets. The scheme mandates the formation/incorporation of a new wholly-owned subsidiary as a ‘resulting company’ for the demerger of non-core assets of the company.
SCI said it will be taking all necessary steps in this regard.
SCI submitted a demerger plan to the stock exchanges last month. Demerger of the non-core business will provide “independence to the [SCI] management in decisions regarding the use of their respective cash flows for dividends, capital expenditure or other reinvestment in their respective businesses,” the company said on 4 August 2021.
The demerged company will seek to list its securities on the Bombay Stock Exchange and the National Stock Exchange of India.
On a consolidated basis, net profit of SCI declined 52.95% to Rs 158.51 crore on 10.11% decline in net sales to Rs 1027.84 crore in Q1 June 2021 over Q1 June 2020.
SCI is the largest Indian shipping company. It owns and operates around one-third of the Indian tonnage, and has operating interests in practically all areas of the shipping business; servicing both national and international trades.
Source: Capital Market