The Indian share markets continues to trade flat during the noon trading session amid weakness in global markets. Sectoral indices are trading on a mixed note with consumer durables & IT stocks trading in the red. While auto & FMCG stocks are witnessing buying interest.
The BSE Sensex is trading lower by 29 points while the NSE Nifty is trading lower by 6 points. The BSE Mid Cap index is trading up by 0.2% and BSE Small Cap index is trading down by 0.1%. Gold prices, per 10 grams, are trading at Rs 28,068 levels. Silver price, per kilogram is trading at Rs 41,120 levels. Crude oil is trading at Rs 3,499 per barrel. The rupee is trading at 68.37 to the US$.
According to a leading financial daily, Mahindra & Mahindra’s (M&M)(MAHMF) board has approved the demerger of Mahindra Two Wheelers Ltd.’s two-wheeler undertaking, which manufactures and sells two wheelers.
Reportedly, M&M approved a scheme of arrangement which envisages demerger of the two wheeler undertaking of its step down subsidiary Mahindra Two Wheelers (MTWL) and transfer and vesting thereof as a going concern into the company. All assets and liabilities of Mahindra Two Wheelers Ltd (MTWL) pertaining to the two wheeler undertaking would be transferred to M&M.
The proposed demerger is in line with M&M’s strategy of focusing on niche premium two-wheeler segment. It would enable the two-wheeler undertaking to benefit from the company’s design and development and sourcing capabilities. The demerger would also enable the demerged entity to enhance focus on the spares business.
Moreover, M&M’s wholly owned subsidiary Mahindra Vehicle Manufacturers Ltd (MVML) holds 91.3% stake in Mahindra Two wheelers. The merger is likely to strain M&M financials. Also, M&M would have to issue 50 million shares to other shareholders of the undertaking leading to equity dilution of about 0.1%, the reports noted.
