On further contemplating, stock price reaction apart as that is something i am not very much concerned over short term, i feel the decision to hold 40% stake in demerged entity is a reasonable one putting ourself in management shoes. As someone rightly pointed out, they would otherwise risk to loose control over the business if and when BAT sells or someone keeps picking more stake with takeover interest.
The intention was always of a demerger and not sale… so IMO the structure of demerger is very reasonable as per that to protect all interest as per the original intention. I think short term investors are the ones who did not like as this may pause short term rally and/or momentum of the stock price.
Business vise and decision vise there is no surprise.
Disc: Second largest holding by market value and largest by cost hence biased & critical. Post only for academic purposes and I can be wring in all my assessments. Not a buy/sell recommendation. Not eligible for any advice.
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