Indian companies achieved a 10-year high in demerger activity in 2025, with deals worth over ₹3,500 crore according to Business Standard analysis of LSEG data. This represents the highest demerger value recorded in India since 2015, with the trend continuing into 2026 where five additional demergers worth ₹764 crore have been completed. The year 2026 has accounted for 75% of emerging market demergers by value, demonstrating India's leadership in this corporate restructuring trend.
Several high-profile companies have executed significant demergers in recent years. Vedanta is planning to demerge into five separate entities including Vedanta, Vedanta Aluminium, Vedanta Power, Vedanta Iron and Steel, and Vedanta Oil and Gas. Other notable demergers include Tata Motors separating its passenger and commercial vehicle businesses, Hindustan Unilever demerging its ice cream unit Kwality Wall's (India), and Natco Pharmaceuticals splitting its agrochemicals unit. Jubilant Agri and Consumer Products has also announced the demerger of its agriculture and consumer businesses.
According to JM Financial's Sonia Dasgupta, corporates are increasingly pursuing demergers as markets no longer reward complexity. Investors prefer focused businesses, streamlined capital allocation, independent management teams, and transparent performance metrics. As reported by Business Standard, demergers allow each business to attract relevant shareholder bases, pursue independent growth strategies, and unlock value by removing conglomerate discounts. Market analyst Anand Tandon noted that while mergers are typically viewed negatively due to underperformance issues, demergers are assumed to improve company performance post-restructuring.
The surge in Indian demergers occurs amid a slowdown in developed market demergers, with 72 deals worth ₹122 billion in 2025 compared to peak annual numbers of over 100 deals in 2015 and 2021 worth over ₹200 billion each year. In the unlisted space, Nirma and Ocular Enterprise have announced a demerger involving bathing soap and detergent maker Nirma and Ocular Enterprise, with Ocular holding operational undertakings of chemical and consumer businesses while Nirma holds investments in Karnavati Holding Inc and Alivus Life Sciences.
