Spin-off season on Dalal Street

Listed companies have looked to spin off their subsidiaries into separately listed companies as the bull run has gathered pace. There have been two such instances in recent times on Dalal street.

Gulf Oil Corporation recently demerged its lubricants business to list it as a separate entity-Gulf Oil Lubricants India Limited.

“The demerger of the lubricants business from the company was planned in a way that on demerger, the lubricants business would have reached a turnover of around Rs 1,000 crore and will have several business initiatives and a large expansion project in hand to grow the business further.”

The original listed entity, would now include its other businesses including mining, real estate and explosives.



Consumer goods company Marico, known for oil brands such as Parachute, spun off its skincare and wellness division. This demerged business listed under the name Marico Kaya Enterprises Limited.

It had a consolidated turnover of Rs.362 crore for the financial year ending in March 2014, according to company figures. This included its Singapore business which was sold out in January 2014.

The mother company of Marico would continue to derive revenues from its primary business segment consisting of consumer products such as coconut and edible oils, as well as grooming products and health foods.