Business EconomyPosted at: Dec 14 2025 6:19PM


HUL demerger of Ice Cream business comes into effect, shareholders receive Kwality Wall’s shares

New Delhi, Dec 14 (UNI) The demerger of Hindustan Unilever Limited’s ice cream business has formally come into effect, marking a major corporate restructuring for one of India’s largest FMCG companies.
The National Company Law Tribunal (NCLT), Mumbai Bench, has sanctioned the Scheme of Arrangement between Hindustan Unilever Limited (HUL) and Kwality Wall’s (India) Limited (KWIL), paving the way for the transfer of the ice cream business into a separate listed entity.
The scheme, approved through orders dated October 30 and November 6, 2025, has become effective from December 1, 2025, which also serves as the appointed date.
Under the arrangement, HUL’s ice cream business has been demerged and vested in KWIL on a going concern basis, allowing the stand alone ice cream business to operate independently.
As part of the demerger consideration, KWIL has allotted 234.95 crore equity shares of Re 1 each to eligible shareholders of HUL. The allotment was made to shareholders whose names appeared in the register of members and beneficial owners as on the record date of 5 December 2025.
The shares were issued in a 1:1 ratio, meaning shareholders received one fully paid-up equity share of KWIL for every one fully paid-up equity share held in HUL.
The restructuring also brings clarity on the cost of acquisition for shareholders from a taxation perspective. For the purpose of calculating post-demerger capital gains, the total cost of acquisition of HUL shares is to be apportioned between HUL and KWIL.
Of the original investment value, 98.09 per cent will continue to be attributed to HUL shares, while 1.91 per cent will be allocated to the newly received KWIL shares.
To illustrate, a shareholder who purchased 1,000 HUL shares at Rs400 per share, with a total investment of Rs 4 lakh, will now hold 1,000 HUL shares and 1,000 KWIL shares.
Of the total cost, Rs 3,92,360 will be considered the cost of acquisition for the HUL shares, while Rs 7,640 will be attributed to the KWIL shares.
The cost allocation ratio has been determined based on the net worth of HUL and the net assets of the ice cream business as of 30 November 2025, in line with the applicable provisions of the Income Tax Act.
The company has also clarified that the allotment of KWIL shares under the scheme will not be treated as a transfer for tax purposes. Additionally, the date of acquisition of KWIL shares will be deemed to be the same as the original acquisition date of the corresponding HUL shares.
HUL has, however, advised shareholders to treat this communication as general guidance and not as a substitute for professional advice. Tax authorities or appellate bodies may take a different view, and shareholders have been encouraged to consult their own tax advisors to understand the implications based on their individual circumstances.
With the demerger now in effect, the move is expected to sharpen strategic focus, allowing HUL and KWIL to pursue distinct growth paths while providing shareholders with direct ownership in both businesses.
UNI SAS RKM
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