HEG Advanced Materials: Guidance on Cost Apportionment Post Demerger
HEG Advanced Materials guides shareholders on post-demerger cost apportionment. Following the demerger sanctioned on August 13, 2026, shareholders are advised to allocate 27.60% of their acquisition cost to HEG Advanced Materials and 72.40% to HEG Graphite Limited. The demerger is tax-neutral.
The guidance on cost apportionment is crucial for shareholders' tax calculations related to the demerger. While not directly impacting current financials, it has a significant implication for future capital gains tax calculations.
The announcement provides guidance on cost apportionment for tax purposes following a demerger. It is informational and does not contain performance-related news or significant positive or negative developments.
HEG Advanced Materials Limited (formerly HEG Limited) has issued guidance to its equity shareholders regarding the apportionment of the cost of acquisition of shares following the demerger of its Graphite Business. This demerger was sanctioned by the Hon'ble National Company Law Tribunal, Indore Bench, via an order dated August 13, 2026.
The Composite Scheme of Arrangement involved the demerger of the Demerged Undertaking into HEG Graphite Limited (Resulting Company) and the amalgamation of Bhilwara Energy Limited (Transferor Company) with HEG Limited (Transferee Company, now HEG Advanced Materials Limited).
In relation to the demerger, 1 fully paid-up equity share of ₹2 each of the Resulting Company was allotted for every 1 equity share of ₹2 each held in the Demerged Company. This allotment was made based on the record date of September 7, 2026, with shares allotted on September 11, 2026.
The demerger is considered tax-neutral for shareholders under Section 70(k) of the Income-tax Act, 2025. For tax purposes, the acquisition date of the new shares will be the same as the original shares of HEG Advanced Materials Limited. The cost of acquisition for the new shares will be determined proportionally based on the net book value of assets transferred in the demerger compared to the net worth of the Demerged Company before the demerger. Consequently, the cost of acquisition of the original shares held by a shareholder will be reduced by this allocated cost.
Shareholders are advised to apportion their pre-demerger cost of acquisition as follows: 27.60% to HEG Advanced Materials Limited and 72.40% to HEG Graphite Limited. The company emphasizes that this is general guidance and shareholders should seek professional advice for their specific tax implications.
What to do with a filing like this
HEG Advanced Materials Limited filed this with the NSE as a statutory disclosure, categorised under demerger. It is a primary document, not a recommendation, and the desk marks it medium impact: worth reading, rarely worth acting on by itself.
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See the model portfoliosA plain-language summary of a public exchange filing by HEG Advanced Materials Limited. Read the original for the full detail.