Kwality Wall's Listing Date Announced as HUL Gets Trading Approval for Demerged Entity

Why It Matters

The listing unlocks value from a capital‑intensive, seasonal business, sharpening HUL’s focus on core FMCG categories while offering investors a distinct exposure to India’s growing ice‑cream market.

Key Takeaways

• Kwality Wall’s to list on Feb 16 with 2.34 bn shares
• One‑for‑one share allocation to HUL shareholders as of Dec 5
• Magnum Ice Cream Co. acquires 61.9% stake, providing global backing
• Valuation projected Rs50‑55 per share, ~5× EV/sales
• Seasonal, margin‑thin business; FY25 EBITDA 7.1%, breakeven FY26 H1

Pulse Analysis

The de‑merger of Kwality Wall’s marks a strategic pivot for Hindustan Unilever, allowing the conglomerate to shed a capital‑intensive, seasonal segment and concentrate on its core home‑care, personal‑care, beauty and food portfolios. By creating a stand‑alone ice‑cream entity, HUL not only clarifies its balance sheet but also offers the market a pure‑play vehicle to capture the fast‑growing frozen dessert category, which benefits from a robust cold‑chain network of over 200,000 cabinets across India.

Investors are eyeing the proposed Rs 50‑55 per share valuation, which translates to roughly a 5× EV‑to‑sales multiple—significantly below HUL’s overall FMCG multiple of about 9×. The lower multiple reflects the ice‑cream business’s seasonal demand patterns and thinner margins, especially after reporting a FY25 EBITDA margin of 7.1% that slipped to breakeven in H1 FY26. However, the recent GST reduction from 18% to 5% and a projected 11% CAGR for FY25‑30 provide a tailwind for volume recovery and premium‑segment expansion, with brands like Magnum and Cornetto poised to capture higher price‑point sales.

For the broader market, Kwality Wall’s debut will serve as a litmus test for value‑unlocking strategies via spin‑offs in India’s FMCG space. A successful listing could encourage other conglomerates to consider similar carve‑outs, while also prompting analysts to reassess the risk‑return profile of seasonal consumer businesses. Meanwhile, HUL’s post‑demerger balance sheet should exhibit improved margins and cash conversion, reinforcing its commitment to margin expansion and premiumisation across its remaining product lines.

Kwality Wall's listing date announced as HUL gets trading approval for demerged entity

By Akash Podishetti, ETMarkets.com · Last Updated: Feb 13 2026, 04:52 PM IST

Hindustan Unilever Ltd (HUL) has received listing and trading approvals from the BSE and NSE for 2,34,95,91,262 equity shares of its de‑merged ice‑cream business, clearing the way for Kwality Wall’s (India) to debut on the exchanges on February 16. The listing marks the formal culmination of HUL’s first major portfolio break‑up in years. The hive‑off of the ice‑cream vertical became effective from December 1 last year, with December 5 fixed as the record date to determine eligible shareholders.

Under the approved scheme, shareholders holding HUL shares at the close of December 5 received one share of Kwality Wall’s for every one share held. With exchange approvals now in place, these shares will begin trading next week, creating India’s first pure‑play listed ice‑cream company.

The demerger is part of HUL’s broader strategy to unlock value by separating a capital‑intensive, seasonal and structurally distinct business from its core FMCG portfolio. The ice‑cream business, which houses brands such as Cornetto, Magnum, Feast and Creamy Delight, operates with one of the largest cold‑chain networks in India, with over 2 lakh cabinets.

Following the spin‑off, The Magnum Ice Cream Company will acquire 61.9 % of Kwality Wall’s from the Unilever Group, giving the standalone entity global strategic backing.

Brokerage Nuvama Equities had earlier indicated a potential valuation of Rs 50‑55 per share, implying roughly 5× EV/sales. That is lower than HUL’s broader FMCG multiple of around 9× EV/sales, reflecting the seasonal nature and lower margin profile of the ice‑cream segment.

The category received a structural boost after GST on ice‑cream was cut from 18 % to 5 %, a move analysts see as positive for affordability and impulse consumption. Nuvama expects the tax cut to aid volume recovery and support category growth above the projected 11 % CAGR for FY 25‑30.

However, the standalone business faces challenges. Ice‑cream is inherently seasonal and margin‑thin compared with other FMCG categories. Kwality Wall’s reported an EBITDA margin of 7.1 % in FY 25, which slipped to breakeven in the first half of FY 26. This compares with high‑teen margins for peers such as Vadilal and Havmor. Analysts have flagged clarity on capex, manufacturing investments and cash position as key triggers for margin recovery.

Despite a large cold‑chain footprint, the company’s distribution reach remains limited relative to India’s 40‑50 lakh grocery outlets, leaving room for expansion. Premium brands such as Magnum and Cornetto are expected to increase their share of sales over the next five years, aided by innovation and new pack‑price formats in the Rs 10‑50 range.

For HUL shareholders, the listing represents both value unlocking and a shift in portfolio mix. Post‑demerger, HUL will operate without its ice‑cream vertical, sharpening its focus on home care, personal care, beauty and food categories.

HUL’s recent operating performance provides context to the separation. In Q3 FY 26, the company reported 2.8 % year‑on‑year revenue growth, with underlying volumes expanding 4 %. Management indicated gradual improvement in demand trends, supported by moderating food inflation and improving consumer sentiment.

EBITDA margin for the quarter stood at 23 %, down 14 basis points year‑on‑year due to gross‑margin pressure, but management expects sequential improvement supported by a favourable price‑cost equation and productivity initiatives. The company reiterated its 22‑23 % margin guidance while maintaining a focus on volume‑led growth and premiumisation.

The market’s response on debut will signal whether the value‑unlocking thesis translates into sustained investor interest.