Tata Group mulling sale of Voltas's home appliances business
What's the story
Tata Group is said to be contemplating the divestment of its home appliances division within Voltas, where it owns nearly a 30% stake.
Bloomberg reports that the company foresees challenges in expanding the business amid a competitive landscape.
The deliberations are in their early stages, and it remains unclear whether Tata will include Voltas' domestic joint venture, Voltbek Home Appliances, in the potential sale.
Details
Impact on Voltas shares and market value
Following the news of Tata Group's possible divestment of its home appliances segment in Voltas, the firm's stock price dipped almost 2% to a session low of Rs. 812.5.
At the time of writing, Voltas shares traded at Rs. 814.50 apiece on NSE, pulling its market capitalization down to Rs. 26,950 crore.
The company, which produces items such as air conditioners and water coolers, has not yet issued a statement regarding the matter.
What Next?
Voltas' Q2 profit falls short of expectations
Voltas disclosed in October that its Q2 earnings fell short of analysts' predictions due to increased raw material expenses.
This financial performance may be a factor in Tata Group's deliberations about selling its home appliances unit within Voltas.
As more details emerge, the potential sale's implications for both Voltas and Tata Group as a whole remain to be seen.