HEG Ltd's stock price fell sharply by over 64% on September 7, 2026, opening at around ₹260 compared to its previous close of approximately ₹728. This decline coincides with the company's demerger of its graphite electrode business into a new entity, HEG Graphite Limited. The record date for determining shareholders eligible for shares in the new company is September 7, 2026, the same day as the price adjustment, according to livemint.com.
The demerger scheme involves transferring HEG's graphite electrode business to HEG Graphite Limited, with shareholders receiving shares in the new entity at a 1:1 ratio. This restructuring caused the sharp drop in HEG's share price, reflecting the separation of the graphite business rather than a loss in overall value. Investors holding HEG shares as of the record date are entitled to receive equivalent shares in HEG Graphite Limited, ensuring their total investment value remains intact, livemint.com reported.
This move aligns with corporate strategies where companies separate distinct business verticals to unlock focused growth and operational efficiencies. HEG's demerger is notable in the graphite electrode sector, which is critical for electric arc furnace steel production. Similar demergers in related industries have allowed clearer valuation and strategic focus on core operations. The market reaction to the share price adjustment is typical in such cases, as the combined entity's value is split between the parent and the spun-off company, as noted by livemint.com.
The record date for the demerger is September 7, 2026, after which shares of HEG Graphite Limited will be allotted to eligible shareholders. Trading in HEG shares will continue with the adjusted price reflecting the separation. Investors will monitor the performance of both entities independently in subsequent trading sessions, as detailed by livemint.com.