In a significant corporate restructuring, Siemens Ltd. has completed the demerger of its energy business, resulting in the formation of a new entity — Siemens Energy India Ltd. This move, in alignment with the global spin-off initiated by Siemens AG in 2020, aims to streamline the operations of both entities, allowing them to focus more strategically on their respective sectors.

What Led to the Demerger?

Siemens AG, the parent company of Siemens India, first spun off its energy business globally in 2020 to create a focused energy-specific arm — Siemens Energy AG. The Indian arm followed suit, with the demerger formally approved by the National Company Law Tribunal (NCLT) on March 26, 2025.

The purpose of this demerger was to unlock value for shareholders and enable both businesses — core industrial tech and energy — to pursue independent growth paths.

Share Price Adjustment and Market Reaction

As a result of the demerger:

• Siemens India's share price dropped nearly 50% from its earlier levels. The last traded price before adjustment on April 4 was ₹2,450, and post-adjustment, it was seen below ₹2,500.

• The sharp fall is not due to a loss in value, but rather an adjustment to reflect the spin-off of Siemens Energy India.

• A special pre-open session was conducted, during which the price of Siemens Energy India was discovered and subtracted from Siemens India’s April 4 closing price to determine the new opening price.

As of the last session, Siemens shares were trading 37.36% lower at ₹3,087, which reflects the adjusted valuation.

Record Date and Share Allocation

• The record date for the demerger is April 8, 2025 (Monday).

• Shareholders who held Siemens India shares as of Friday, April 4, were eligible to receive shares in the newly formed Siemens Energy India.

• The allocation ratio is 1:1, meaning shareholders will receive one Siemens Energy India share for every Siemens India share they owned.

This ensures that existing investors do not lose value but rather gain exposure to both Siemens India and Siemens Energy India post-demerger.

What is a Spin-Off?

For those unfamiliar, a spin-off is a process where a company splits a part of its operations into a separate legal entity, and distributes shares of the new company to existing shareholders. This approach is often taken to unlock shareholder value and allow each company to pursue specialized strategies.

In this case, Siemens India is now primarily focused on industrial technology and digital transformation, while Siemens Energy India will specialize in power generation, transmission, and energy systems.

Inclusion in Nifty Indices

Another important development is that Siemens India will now be the 51st stock in the Nifty Next 50 index, effective from the record date. This inclusion indicates market confidence in the standalone business potential of Siemens India after the demerger.

Additionally:

• Passive funds (like index funds and ETFs) will temporarily continue to include the energy unit in their holdings.

• This will last for three trading days after the listing of Siemens Energy India, providing buffer time for fund rebalancing.

Implications for Investors

For retail and institutional investors, this development holds multiple implications:

• Those who held Siemens India shares before April 4 will now have stakes in two separate companies.

• This creates a more diversified portfolio exposure, covering both industrial and energy segments.

• The adjusted pricing might seem like a dip, but in real terms, the combined value remains intact or could grow over time depending on the performance of both companies.

Analysts often view spin-offs positively as they tend to unlock value, improve transparency, and enable better governance structures within each entity.

Listing of Siemens Energy India

Currently, Siemens Energy India Ltd is not yet listed independently on the stock exchanges. The official listing date is expected soon, and until then, its value will be included in Siemens India’s adjusted pricing.

Post listing, Siemens Energy India is expected to:

• Have its own stock symbol.

• Trade independently on both NSE and BSE.

• Be part of certain indices temporarily through passive fund tracking.

This will also give investors the option to trade in either company depending on their investment strategy.

Background: Siemens AG’s Global Spin-Off Strategy

Globally, Siemens AG initiated the energy business spin-off to focus more sharply on automation, digitalisation, and industrial infrastructure. Siemens Energy AG, headquartered in Germany, is now a major global player in power and energy systems, and the Indian spin-off is aligned with that global structure.

With clean energy and decarbonisation being the next big industrial wave, Siemens Energy India will likely pursue projects in renewables, smart grids, and sustainable infrastructure, especially amid India’s green energy transition.

Final Thoughts

This demerger marks an important phase in Siemens India’s journey. By unbundling its energy division, the company is signaling focus, transparency, and strategic clarity. Investors, especially long-term holders, should closely monitor:

• The listing performance of Siemens Energy India.

• Quarterly results from both entities post demerger.

• Changes in fund holdings and index rebalancing post-listing.

In conclusion, while the short-term stock price may look like a decline, the actual value delivered to shareholders remains intact — and could increase if both companies execute well in their respective domains.

The Upcoming IPOs in this week and coming weeks are Aten Papers & Foam.

The Closed IPOs are  Infonative Solutions Limited, Spinaroo Commercial Limited,Retaggio Industries Limited.

Start your Stock Market Journey and Apply in IPO by Opening Free Demat Account in .Choice Broking FinX