HUL demerger record date tomorrow—Here’s what shareholders must know before market close

HUL share price: Hindustan Unilever will separate its ice-cream business, Kwality Wall’s India, with December 5 set as the record date for the demerger. Investors holding HUL shares on that date will receive one share of the demerged entity for every HUL share they own, based on a 1:1 entitlement ratio. Thursday, December 4, is the last trading day for HUL as a combined company.

Special pre-open session on December 5

Both exchanges will conduct a special pre-open session on the record date to determine the adjusted price of HUL post spin-off. Once the price discovery is completed, fresh F&O contracts will be introduced to reflect the restructured entity.

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Impact on F&O contracts

All existing HUL futures and options contracts will expire at the end of trade on December 4. After the special session on December 5, the exchanges will relaunch contracts aligned with the new adjusted price of HUL.

How indices will adjust for the demerger

Index providers MSCI and FTSE will temporarily add Kwality Wall’s at the discovered price on December 5 and later remove it after the stock begins trading.

Nifty and Sensex will use their standard treatment by adding a dummy stock—representing Kwality Wall’s—at zero price alongside HUL one day before the record date. The dummy stock’s price will reflect the difference between HUL’s closing price on T-minus-one and the special session’s discovered price. If both match or the discovered price is higher, the dummy stock remains at zero until listing.

Timeline for listing and index removal

The new company may take up to a month to list as regulatory approvals are completed. After listing, exchanges will monitor its trading behaviour before removing it from indices.

On the NSE, Kwality Wall’s can be removed after the third trading day if it does not hit the upper or lower circuit for two straight sessions. If it does, exclusion is delayed until two stable sessions occur. The BSE follows a similar approach but only tracks lower-circuit movements.

Stock performance

HUL shares closed 1.47 per cent lower on Wednesday at Rs 2,441.50.