Description

SKF India Limited is demerging its Automotive and Industrial Business into SKF India (Industrial) Limited effective October 15, 2025, with 1:1 share allocation and addition to multiple BSE indices at zero price.

Summary

SKF India Limited (Ticker: 500472, SKFINDIA) is demerging its Automotive and Industrial Business into a new entity called SKF India (Industrial) Limited, effective from the start of trading hours on Wednesday, October 15, 2025. Shareholders will receive 1 equity share of SKF India (Industrial) Limited for every 1 equity share held in SKF India Limited. A Special Pre-Open Session (SPOS) will be conducted on October 15, 2025, to enable price discovery for SKF India Limited post-demerger. The new entity will be added to 11 BSE indices at zero price without divisor adjustment.

Key Points

  • Demerger of Automotive and Industrial Business from SKF India Limited into SKF India (Industrial) Limited
  • Share allocation ratio: 1:1 (one share of new entity for every share of existing entity)
  • Effective date: Start of trading hours on Wednesday, October 15, 2025
  • Special Pre-Open Session (SPOS) scheduled for October 15, 2025, for price discovery of SKF India Limited post-demerger
  • SKF India (Industrial) Limited equity shares expected to list on BSE at a future date (specific date not yet announced)
  • Addition to 11 BSE indices at zero price after close of Tuesday, October 14, 2025, without divisor adjustment

Regulatory Changes

No regulatory framework changes. This circular announces a corporate action (scheme of arrangement/demerger) under existing regulations.

Compliance Requirements

  • BSE will conduct Special Pre-Open Session (SPOS) on October 15, 2025, for price discovery
  • Index constituents and weightings will be adjusted automatically by BSE Index Services
  • Market participants should note the zero-price addition to indices without divisor adjustment
  • Queries should be directed to bseindex@bseindia.com

Important Dates

  • October 9, 2025: Circular notification date
  • October 14, 2025: Last trading day before demerger (close of trading)
  • October 15, 2025: Demerger effective from start of trading hours; Special Pre-Open Session for price discovery; SKF India (Industrial) Limited added to BSE indices
  • Future date (TBA): Expected listing of SKF India (Industrial) Limited equity shares on BSE

Impact Assessment

Market Impact: High. The demerger of a significant industrial company with immediate index inclusion across 11 major BSE indices will impact index calculations, portfolio rebalancing, and trading strategies. The Special Pre-Open Session indicates potential volatility and the need for price discovery mechanism.

Index Impact: SKF India (Industrial) Limited will be added to the following 11 BSE indices:

  1. BSE 500
  2. BSE Capital Goods
  3. BSE SmallCap
  4. BSE AllCap
  5. BSE Industrials
  6. BSE SmallCap Select Index
  7. BSE 250 SmallCap Index
  8. BSE 400 MidSmallCap Index
  9. BSE 1000
  10. BSE 1000 MultiCap Equal Size Weighted (25%)
  11. BSE MidSmallCap

Operational Impact: Index funds and ETFs tracking these 11 indices will need to adjust their portfolios. The zero-price addition without divisor adjustment means no immediate index level impact, but future price movements will affect index values. Shareholders of SKF India Limited will receive additional shares in the new entity, requiring custody and accounting adjustments.

Trading Impact: The Special Pre-Open Session is designed to facilitate orderly price discovery, suggesting potential significant price movement post-demerger. Market participants should prepare for corporate action processing and potential liquidity changes.

Impact Justification

Major corporate restructuring involving demerger with 1:1 share allocation, Special Pre-Open Session for price discovery, and immediate inclusion in 11 BSE indices including flagship BSE 500 index.