NCLT Indore Clears First-Motion Application For Demerger Of Indo Thai Securities' Broking Undertaking

The Indore Bench of the National Company Law Tribunal (NCLT) has allowed a first-motion application filed by Indo Thai Securities Limited (ITSL) and its wholly owned subsidiary, Indo Thai Financial Services Limited (ITFSL), in connection with a proposed demerger of ITSL's broking and distribution business.

The order was passed on June 10 by a bench of Judicial Member Brajendra Mani Tripathi and Technical Member Man Mohan Gupta.

ITSL, incorporated in 1995, is a listed company engaged in broking and distribution, real estate and green technology businesses. It has 17,326 equity shareholders and is listed on both the BSE and NSE.

ITFSL was incorporated in September 2025 as a wholly owned subsidiary of ITSL. Following the proposed demerger, it is intended to carry on the broking and distribution business. The company has seven shareholders, comprising ITSL and six nominee shareholders. It has no secured or unsecured creditors.

The boards of both companies approved the scheme on October 13, 2025.

Under the proposed arrangement, ITSL's broking and distribution undertaking will be transferred to ITFSL as a going concern. The scheme also provides for cancellation of ITFSL's existing paid-up share capital and listing of its equity shares on the BSE and NSE.

Explaining the rationale behind the restructuring, the companies submitted that the move would allow ITFSL to focus exclusively on the broking and distribution business. ITSL, in turn, would be able to streamline its remaining operations.

The companies further submitted that separating the businesses would unlock value, support focused growth, enable independent capital allocation and facilitate balance-sheet management suited to the requirements of each business vertical.

According to the application, the scheme does not prejudice the interests of promoters, non-promoter shareholders, directors, key managerial personnel, employees, creditors or other stakeholders.

The record also noted that no investigation or inspection was pending against either company under the Companies Act. At the same time, two income-tax assessment appeals involving ITSL were pending in the ordinary course.

ITSL has three secured creditors and 1,004 unsecured creditors. All three secured creditors furnished consent affidavits approving the scheme.

ITFSL's seven shareholders also submitted consent affidavits. Since ITFSL has no secured or unsecured creditors, no meetings of creditors were required.

Taking note of the consents received, the Tribunal dispensed with meetings of ITSL's secured creditors and ITFSL's shareholders. However, it directed that meetings of ITSL's equity shareholders and unsecured creditors be convened within 45 days through video conferencing or other audio-visual means.

The Tribunal also directed the companies to serve notices on the Regional Director (North-Western Region), Registrar of Companies, Official Liquidator, Income Tax Authorities, SEBI, NSE, BSE and RBI.

Advocate Rohit Dubey was appointed Chairperson for the meetings. Advocate Jatin Sehgal was appointed Alternate Chairperson, while practicing company secretary Kaushal Ameta was appointed Scrutinizer.

Allowing the application, the tribunal directed the companies to file a second-motion petition after complying with the notice requirements and upon receipt of representations, if any, from the statutory authorities.