Indiabulls Real Estate - Event Update - Motilal Oswal

INDIABULLS REAL ESTATE: Board approves de-merger of Power business

IBREL will transfer the power business, comprising of 59% stake in Indiabulls Power as a going concern to Indiabulls Infrastructure and Power Limited (IIPL). This is a 100% subsidiary of IBREL; and shareholders of IBREL will be entitled to 2.95 shares of IIPL for every 1 share held in IBREL.

Indiabulls Builders (a 100% sub of IBREL) will be amalgamated with IBREL. We believe this exercise is to create focused entities & address shareholder concerns.

Prior to this step, investors were ascribing a holding company discount to IBREL's ~59% stake in IPL; while this step still maintains a status quo as shareholders continue to hold shares in an unlisted holding company, going forward this issue could be potentially addressed by merging/amalgamating IIPL with IPL.

Motilal Oswal currently have a Buy rating on IBREL.

Source : Equity Bulls

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