Disclosure under Regulation 30 of Listing Regulations regarding Sale of Business Undertaking
M&A
◆ Monitor Closely
MEDIUM RISK
📅 Filed on BSE: 30 Jun 2026, 08:00 PM IST · BSE ID: 74bab500-2c4a-4e72-a78c-933dbaa28a8a
View Original BSE Filing (PDF)
💡
In Simple Terms
Hindustan Composites will sell its main Friction Business to Rane (Madras) Limited for INR 370 Crore cash.
🤖 AI Summary
- Board approved slump sale of 'Friction Business Undertaking' to Rane (Madras) Limited.
- Consideration is INR 370 Crore in cash, subject to transaction adjustments as per BTA.
- Friction Business contributed 84% of turnover and 7.50% of net worth in FY26.
- Shareholder approval is required through Postal Ballot under Section 180(1)(a).
- Completion of the transfer is expected on or before September 30, 2026.
🔢 Key Numbers — exact figures from BSE filing, not rounded
Friction Business Turnover (FY26)
INR 315.04 Crores
Friction Business Turnover % of Company (FY26)
84%
Friction Business Networth (March 31, 2026)
INR 69.52 crores
Friction Business Networth % of Company (March 31, 2026)
7.50%
Consideration from Sale
INR 370 Crore
🏢 How This Affects the Company
The company will divest its 'Friction Business Undertaking', which generated 84% of its turnover in FY26, significantly altering its revenue base and core operational focus.
The company expects to receive INR 370 Crore in cash from the sale, which will increase its cash reserves and could change its balance sheet structure.
Divesting the 'Friction Business Undertaking' will lead to a significant change in the company's manufacturing and marketing operations related to automobile, railway, and industrial friction materials.
The company will reduce its reliance on the friction materials sector, potentially mitigating risks associated with that specific market segment, but also exiting its primary revenue generator.
👥 What This Means For Shareholders
✅
Action Required
Shareholders must participate in the Postal Ballot process to approve the proposed slump sale as per Section 180(1)(a) of the Companies Act, 2013.
👤
Who Is Affected
All shareholders will be affected by the decision to sell a business undertaking that accounted for 84% of the company's turnover and 7.50% of its net worth as of March 31, 2026.
🔍
Management Signal
Management is signaling a strategic shift by divesting its core 'Friction Business Undertaking' and generating significant cash proceeds.
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👁 Watch List — track these upcoming events
Outcome of the Postal Ballot for shareholder approval of the slump sale.
Announcement of the definitive closing date for the business transfer agreement.
Details of how the INR 370 Crore cash proceeds will be utilized by the company.
MEDIUM RISK
The company is divesting its primary revenue stream, creating uncertainty about its future business direction.
💡 Investor Takeaway
Hindustan Composites' Board approved the slump sale of its Friction Business Undertaking to Rane (Madras) Limited for INR 370 Crore cash. This business represented 84% of the company's turnover and 7.50% of net worth in FY26. Shareholder approval is pending via Postal Ballot.
⚖️ Strengths & Concerns
✅ Positives
- Receipt of INR 370 Crore in cash will significantly boost the company's liquidity, available for future strategic initiatives.
- The buyer, Rane (Madras) Limited, is not a promoter/promoter group entity, confirming an arm's length transaction.
⚠️ Concerns
- The divested 'Friction Business Undertaking' accounted for 84% of the company's turnover in FY26, indicating a substantial reduction in current operational scale.
- The sale is still subject to shareholder approval and completion of conditions precedent, which are not yet finalized.
❓ Frequently Asked Questions
What business is Hindustan Composites Ltd selling?
Hindustan Composites Ltd is selling its 'Friction Business Undertaking', which includes development, manufacturing, and marketing of friction material related to automobile, railway, and industrial applications.
What is the sale consideration for the Friction Business Undertaking?
The sale consideration for the 'Friction Business Undertaking' is INR 370 Crore, to be received in cash, subject to certain transaction adjustments.
What was the contribution of the Friction Business to Hindustan Composites' turnover in FY26?
The 'Friction Business Undertaking' contributed INR 315.04 Crores, representing 84% of Hindustan Composites' turnover for the financial year ended March 31, 2026.
When is the sale of the Friction Business expected to be completed?
The completion of the slump sale of the 'Friction Business Undertaking' is expected on or before September 30, 2026, subject to shareholder approval and closing conditions.
Who is the buyer of Hindustan Composites' Friction Business?
The buyer of Hindustan Composites' Friction Business is Rane (Madras) Limited, with corporate identification number L65993TN2004PLC052856.
Questions based on this BSE filing only. For information purposes.