HEG demerger wins NCLT nod in 2026, 1:1 shares

What the NCLT approval means for HEG

HEG Ltd, the Noida-based graphite electrode manufacturer, has received approval from the National Company Law Tribunal (NCLT), Indore Bench, for its Composite Scheme of Arrangement involving HEG Ltd, HEG Graphite Ltd and Bhilwara Energy Ltd. The order was passed on August 18, 2026 and was uploaded on the tribunal’s website the same day. HEG disclosed the receipt of this approval on August 19, 2026. The approval is a key regulatory milestone that clears the way for the proposed demerger structure to move into the final implementation phase. The company has described this as the culmination of regulatory clearances needed for the split into two distinct listed businesses.

The scheme is framed under Sections 230 to 232 and other applicable provisions of the Companies Act, 2013. In practical terms, the NCLT’s sanction validates the legal framework and the process followed for the arrangement among the companies and their stakeholders. But the scheme is not operational immediately on the date of the order alone. The arrangement becomes effective upon the filing of the certified copy of the NCLT order with the Registrar of Companies (RoC).

Entities in the composite scheme and their roles

The composite scheme brings together three entities with specific roles defined in the arrangement. HEG Ltd is identified as the Demerged Company and also as the Transferee Company within the scheme structure. HEG Graphite Ltd is the Resulting Company. Bhilwara Energy Ltd is described as the Transferor Company.

The stated outcome is a corporate reorganisation that results in two independently listed companies. One listed entity is intended to focus on graphite electrodes, while the other is positioned around advanced materials and green energy. The article text does not specify the detailed asset split, timelines for listing actions, or appointed dates. What is clear from the disclosure is the intent to separate business focus areas into two listed vehicles through a tribunal-sanctioned process.

1:1 share entitlement for HEG shareholders

A central element for investors is the share entitlement ratio. Under the approved scheme, every shareholder of HEG Ltd will be entitled to receive one equity share of HEG Graphite Ltd for every one share held in HEG Ltd. The company’s disclosures reiterate that the 1:1 allotment ratio is consistent with what had been previously communicated.

This kind of entitlement is typically designed to ensure continuity of shareholder participation across the reorganised structure. Here, the scheme states that HEG shareholders will receive shares in the resulting company, HEG Graphite Ltd, on a one-for-one basis. The article does not provide record dates for the entitlement or the timeline for credit of shares, and those details would generally be clarified when the company proceeds with the next steps after the scheme becomes effective.

When the scheme becomes effective

Although the NCLT has sanctioned the scheme, the disclosures specify that the scheme becomes effective once the certified copy of the NCLT order is received and filed with the RoC. The company has also stated that the arrangement becomes effective immediately upon such filing.

This filing step matters because it is the operational trigger for implementation actions that follow a tribunal order. Until filing is completed, the approval remains a regulatory sanction but not the effective start date for corporate actions such as share allotment under the scheme. HEG has indicated it will proceed based on the certified copy and the statutory filing requirement.

How the matter progressed at the tribunal

Prior to the final sanction, the NCLT, Indore Bench had reserved its order on July 2, 2026 in relation to the composite scheme of arrangement involving HEG Ltd, HEG Graphite Ltd and Bhilwara Energy Ltd. The later order sanctioning the scheme was passed on August 18, 2026, and HEG communicated the update publicly on August 19, 2026.

The dates highlight the sequence investors often watch in corporate reorganisations: a reserved order date, followed by the final order, and then company disclosures as steps are completed. HEG had also stated earlier that it would inform stock exchanges upon pronouncement of the order.

Key facts at a glance

AGM context: dividend, board items, and governance updates

Alongside the restructuring-related disclosures, HEG’s corporate calendar also included its 54th Annual General Meeting (AGM) held on July 29, 2026 through video conferencing. The meeting had 107 members present, including five members represented by their authorised representatives. Shareholders approved all five proposed resolutions at the AGM.

The AGM included approval for a final dividend of ₹3.40 per equity share for FY26. The company also described this dividend as 170% on a face value of ₹2 per equity share, subject to shareholder approval. The dividend record date was set as July 22, 2026, with book closure from July 23, 2026 to July 29, 2026 (both days inclusive). The company indicated dividend payment would be made within 30 days of the AGM, subject to applicable TDS.

Director changes highlighted in disclosures

HEG’s regulatory filings during the period also included board-related updates. The company accepted the resignation of Smt. Vinita Singhania as a Non-Executive Non-Independent Director effective June 21, 2026, stating the reason as maintaining an optimal and balanced board composition in line with governance requirements. Separately, another disclosure noted that Satish Chand Mehta ceased as an Independent Director at HEG Ltd on June 23, 2026.

At the July 29, 2026 AGM, shareholders approved the re-appointment of Manish Gulati as Executive Director. The AGM also secured approval for the continuation of Shekhar Agarwal as a Non-Executive Non-Independent Director beyond the age of 75, in line with Regulation 17(1A) of SEBI (LODR) Regulations, 2015, as referenced in the meeting agenda disclosures.

Market impact: what shareholders should track next

The immediate market relevance of the NCLT sanction is that it enables HEG to proceed to the final step that makes the scheme effective, namely filing the certified order with the RoC. For shareholders, the practical implication is the 1:1 entitlement of HEG Graphite shares for each HEG share held, once the scheme is implemented as per the approved process.

Because the disclosures do not provide the timetable for allotment, listing steps, or entitlement record dates for the demerger, investors will need to track subsequent exchange filings for operational details. What has been confirmed is the regulatory approval, the entitlement ratio, and the condition for effectiveness. The broader corporate context, including the AGM approvals and board changes, suggests the company is aligning governance and shareholder authorisations during the restructuring period.

Why the development matters

A tribunal-sanctioned composite scheme under Sections 230-232 is a formal legal mechanism for corporate restructuring, and the NCLT’s order is one of the most consequential checkpoints in that process. For HEG, the stated outcome is a split into two independently listed companies with distinct focus areas, one centred on graphite electrodes and the other on advanced materials and green energy.

The clarity on the share swap ratio and the effective-date trigger reduces uncertainty around the framework, even though several operational details are yet to be disclosed in the text provided. The next confirmed procedural step is the receipt and filing of the certified copy of the order with the RoC.

Conclusion

HEG has received NCLT, Indore Bench approval for its composite scheme involving HEG Graphite Ltd and Bhilwara Energy Ltd, with shareholders set to receive HEG Graphite shares in a 1:1 ratio. The order was passed and uploaded on August 18, 2026, and HEG announced the approval on August 19, 2026. The scheme will take effect once the certified copy is filed with the RoC, after which further exchange updates are expected on implementation steps tied to the demerger.