The company currently operates two distinct businesses:
1. Building Products, encompassing sanitaryware, faucets, tiles, and plastic pipes & fittings, operated through its subsidiary, Hindware Limited.
2. Consumer Products, which includes kitchen appliances, consumer appliances, fixtures and fittings, and water heaters, being transferred to a newly formed subsidiary HHIL Limited.

The board has announced strategic demerger of the business into two companies to be listed separately.

As a result of the scheme, an existing shareholder of the Company holding one share in the Company will be allotted one share of HHIL Limited (consumer appliances) and one share of Hindware Limited (building products). HHIL Limited and Hindware Limited shares will be listed on stock exchanges and Hindware Home Innovation Limited (currently listed entity) as a Company will cease to exist.

The Appointed date of the Scheme is April 1st, 2025, and is subject to the applicable approvals, including those of the shareholders and creditors of the companies involved, as well as the approval of the National Company Law Tribunal, having jurisdiction over the companies involved in the Scheme.

The stated intent behind this demerger is value unlocking for shareholders given the distinct nature of both businesses in terms of distribution, right-to-win, capital intensity etc. helping management have better focus on each through separate entities.

So far the capital allocation by this group has been disappointing. We have to see whether this development changes that for the better. There is no change in the rating as it continues to be deeply undervalued.

FY24 Financial Overview
Consumer Products Segment
Sales: Rs 422 Cr.
EBIT: (Rs 48 Cr)

Building Products Segment
Sales: Rs 2,355 Cr.
EBIT: Rs 214 Cr