Hindustan Unilever (HUL) informed the exchanges that it has received approval from its board for formation of a wholly-owned subsidiary. The company will be incorporated with an authorized share capital of Rs 2,000 Cr.
The focus of this subsidiary will be on manufacturing activities in the fast-moving consumer goods (FMCG) segment. This shall bring greater agility to HUL in responding to market demand.
As per Business Standard’s article dtd 25th February a wholly-owned subsidiary is being formed in order to capitalize on the reduced 15% corporate tax available to new companies. As per the same article approx. 500-800 Cr. would be set aside for investment in manufacturing by the proposed subsidiary.