Hul Shares: Record Date Set for Ice Cream Business Demerger

We have big news for HUL shareholders. On 5 December 2025, HUL set the “record date” for spinning off its ice‑cream business into a separate company. From that day on, HUL shares will trade without the ice‑cream unit. The move marks a major shake‑up in how HUL operates. We will explore the background, what the demerger means for investors, and how this could change HUL’s future.

Background of HUL’s Ice‑Cream Business

HUL is one of India’s largest FMCG players. Among its many offerings, the company owns a well-known ice cream segment. That segment includes iconic brands like Cornetto, Magnum, Kwality Wall’s, Feast, and Creamy Delight. Though the ice‑cream business is only a part of HUL, it has been growing steadily. According to HUL’s own data, the ice‑cream division contributes roughly 3% of the company’s overall turnover, with annual revenue around ₹1,800 crore. But ice cream as a business is different from many other FMCG categories.

It needs cold‑chain logistics, dedicated distribution, and faces seasonal demand. Because of these differences, HUL’s leadership decided that ice cream might grow better as a focused, standalone business. Given that, the idea of carving out the ice‑cream business into a separate entity gained ground. This would allow more specialized focus on frozen desserts, without being weighed down by HUL’s broader FMCG operations.

Details of the Demerger

In January 2025, HUL’s Board formally approved a scheme to demerge the ice‑cream business into a new company, KWIL. The separation received approval from regulators, including a nod from the National Company Law Tribunal (NCLT), making the demerger legally valid. The scheme calls for a 1:1 share entitlement ratio, meaning every HUL shareholder gets one share of KWIL for each HUL share they own as of the record date.

The “record date” was set as 5 December 2025. HUL has also fixed 29 December 2025 as the allotment date, when the new KWIL shares will be formally allotted to eligible shareholders. Once demerged, all ice‑cream brands, related assets, liabilities, employees, and everything linked to that business will move to KWIL. This allows HUL to continue focusing on its core FMCG operations while KWIL operates independently.

Impact on Shareholders and Investors

For holders of HUL shares, this demerger brings an interesting benefit. Because of the 1:1 share entitlement, they don’t need to pay extra to get KWIL shares; they receive them free, simply for holding HUL shares on the record date. However, markets seem to react cautiously in the short run. On the record date, HUL shares dropped roughly 7%, reflecting the separation of the ice‑cream business value. This fall is normal: since part of the asset base is shifting out, the HUL share price adjusts to reflect only the remaining business.

For investors, this means volatility, but also a new opportunity. Those interested in the ice‑cream business can hold KWIL, while others may focus on HUL’s core FMCG portfolio. Some analysts believe the ice‑cream business will have a lower valuation multiple compared to HUL’s main business, because of its seasonal demand and relatively lower margins.

On the upside: a standalone KWIL could grow faster, innovate more freely, and deliver better long-term value, especially if ice‑cream demand in India rises.

Strategic Rationale Behind the Demerger

Why did HUL decide to split its ice‑cream business?

First, focus. Ice cream is fundamentally different from soaps, shampoos, groceries, and other FMCG products. It needs cold‑chain storage, logistics and has a demand that depends heavily on weather and season. By spinning it off, KWIL can tailor strategies specifically for frozen desserts. Second, value unlock. Because the ice‑cream business is only ~3% of HUL’s revenue, it may have been undervalued as part of a large conglomerate. As a separate entity, KWIL’s value could become more visible to investors. Third, agility. A smaller, focused company can react faster to market trends, launch new products, and invest in cold‑chain or distribution without being slowed by HUL’s broader structure.

Analysts expect KWIL to benefit from this sharper focus. Some think it could become India’s first pure‑play listed ice‑cream company once it lists.

Stock Market Implications

With the demerger effective from 1 December 2025 and record date on 5 December, HUL shares now trade “ex‑ice‑cream business,” meaning their price excludes the value of what’s now KWIL. Some brokerages estimate that the ice‑cream business accounted for roughly ₹50–₹55 per share, a chunk of HUL’s valuation that is now up for re‑assessment under KWIL. KWIL is expected to debut on the bourses around February 2026.
Investors will watch the listing closely. If KWIL performs well, it could validate the demerger strategy and unlock value for shareholders.

On the flip side, because ice cream is somewhat cyclical and seasonal, KWIL’s performance may swing with demand cycles. Analysts already expect a lower valuation multiple (e.g. ~5× EV/sales) compared to HUL’s ~9× multiple,  reflecting the different risk–return profile. For HUL, shedding the ice‑cream business may help streamline its operations, reduce complexity, and sharpen focus on core FMCG segments.

Conclusion

The demerger of HUL’s ice‑cream business into KWIL is a bold move. By setting the record date on 5 December 2025, HUL has triggered a major restructuring. For shareholders, this means free KWIL shares in a 1:1 ratio in addition to their existing HUL holdings. For HUL as a company, it means a leaner, more focused core business. For KWIL, it means a fresh start, a pure‑play ice‑cream company with growth potential, freedom to innovate, and a chance to shine on its own.

If the winter of 2025 indeed turns into a summer of growth for ice‑cream lovers and investors alike, this demerger might end up being a sweet deal.

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The content shared by Meyka AI PTY LTD is solely for research and informational purposes. Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.