HUL-Kwality Wall's Ice-Cream Demerger Approved! Timeline, Ratio, Listing, Target Price | All You Need To Know

HUL Demerger Update: Hindustan Unilever has finally received approval from the National Company Law Tribunal (NCLT) for the demerger of its ice-cream business into a separate entity, Kwality Wall's (India) Limited. The HUL-Kwality Wall's demerger has raised interest among investors about the timeline of demerger, share ratio, and how the demerger will affect the HUL business.

Hindustan Unilever share price was trading 0.15% lower at Rs 2,466 per share on BSE with a market capitalisation of Rs 5,79,432.70 crore at 2:20 pm. The HUL stock had touched an intraday high mark of Rs 2479.25 per share and an intraday low mark of Rs 2453.65 per share.

HUL Demerger Details

The company, on Thursday, announced that it has received NCLT approval for HUL demerger. "We would like to inform you that the Scheme of Arrangement for demerger of the Ice Cream Business Undertaking, between the Company and Kwality Wall's (India) Limited and their respective shareholders, under Sections 230 to 232 and other applicable provisions of the Companies Act, 2013, has been sanctioned by the Hon'ble National Company Law Tribunal, Mumbai Bench ("NCLT") by its order passed today i.e. 30th October, 2025. A certified copy of the NCLT Order is awaited," read a BSE filing shared by HUL on Thursday.

The company has planned to execute the demerger by the end of the year 2025, and listing before the second half of the year 2026. Here are all the details about HUL demerger.

HUL Demerger Timeline

The company expects the HUL demerger with its ice-cream business by December. Additionally, the new entity, Kwality Wall's India, will be listed on the stock markets by the fourth quarter of financial year 2026 after receiving pending necessary approvals, said Ritesh Tiwari, CFO, Executive Director, Finance & IT, at HUL during conference call on Thursday.

HUL Demerger: How Seperation of Ice Cream Business Will Impact Hindustan Unilever?

The approval to ice-cream business demerger has come against the backdrop of declining business profit of Hindustan Unilever's in the segment due to extended monsoon in the current financial year. The demerger is expected to improve HUL's EBITDA margins.

"Ice Cream demerger is expected to result in an improvement of 50-60 bps to the reported margin as Ice Cream business operates at a margin lower than HUL average. Our current near to mid-term guidance is 22-23%, hence everything else being equal, Ice Cream demerger adds 50-60 bps to this guidance," said Ritesh Tiwari.

If the HUL demerger timeline remains intact and things proceed smoothly, Hindustan Unilever will announce its December quarter result, excluding Ice Cream and Ice Cream business will be shown as a discontinued business.

"Margins excluding Ice Cream will start getting reflected in our December quarter results. Now this is where we are with our timelines assuming nothing changes with all the approvals in place," Tiwari added.

"Management has raised the EBITDA margin guidance to 23-24% from the previous 22-23%. While the near-term EBITDA margin is expected to remain stable, a benefit of c.50-60 bp is anticipated after the demerger of the ice-cream business (c.3% of revenue), which is a lower-margin business. Advertising expenses are expected to remain elevated," noted InCred Equities in its report.

What Will The New Ice-Cream Entity Look Like?

HUL's demerged entity, will likely operate in the name of Kwality Wall's. With the demerger, all the existing ice-cream brands of HIndustan Unilever, will be transferred to the new entity, including Cornetto, Magnum, Feast, Creamy Delight, etc.

How Much HUL's Ice Cream Business Contribute?

Hindustan Unilever's ice cream business contributes around Rs 1,800 crore in annual revenues and accounts for nearly 3% of HUL's total turnover.

HUL Demerger Share Ratio

HUL demerger will occur in the ratio of 1:1. HUL shareholders will receive 1 share of Kwality Wall's (India) for every HUL stock.

HUL Demerger Record Date

The company is yet to finalise the demerger record date. If the company receives pending mandatory approvals for HUL demerger as per the timeline, then the demerger record date can be announced in the next 3-4 weeks, according to reports.

Hindustan Unilever Share Price Target

InCred Equities has maintained an 'Add' rating for HUL with a target price of Rs 2,900 per share. Whereas, PL Capital has given an 'Accumulate' rating for HUL stock with a TP of Rs2,772 apiece. Mirae Asset Sharekhan has given a 'Buy' rating for HUL stock with a TP of Rs 2,997 per share.