The Godrej group was founded by Ardeshir Godrej and his brother Pirojsha in 1897. While Ardeshir had no children, the company went to Pirojsha who had four children – Sohrab, Dosa, Naval, and Burjor. With time, the group’s leadership has gone to Burjor’s children, Adi and Nadir, and Naval’s children, Jamshyd and Smita. The group is in multiple sectors such as chemicals, furniture, security solutions, real estate, home and personal care, heavy engineering, power and energy, aerospace, intra-logistics, infrastructure, food and agriculture products, and information technology.
The Godrej & Boyce Manufacturing Company’s assets include a sprawling 3,400 acres in Vikhroli but out of this about 1,000 acres can be developed and another 1,750 acres have mangroves and will not be developed because of environmental concerns while another 300 acres of land have been encroached upon. Real estate analysts price one acre of land at around Rs 70 crores to Rs 80 crores in Vikhroli, Mumbai.
The 127-year-old multi-million dollar Godrej family group decided to restructure its conglomerate on April 30 to split them into two entities — Godrej Enterprises and Godrej Industries. Godrej group has also decided to amicably split into two groups between Adi Godrej and his cousin Jamshyd Godrej terming the split due to ownership realignment of the shareholdings in the Godrej companies. The realignment has arrived to maintain harmony and to better align ownership in acknowledgment of the differing visions of all the Godrej family members. This will help maximize strategic direction, focus, and agility to accelerate the process of creating long-term shareholder value.
All the Godrej family group promoters viz., Adi Godrej, Nadir Godrej, Jamshyd Godrej, and Smita Godrej Crishna have also sent a joint letter to the stock exchanges about the family settlement agreement and a brand and non-compete agreement having been entered into amongst members of the Godrej family.
According to the family settlement agreement, the GIG or Godrej Industries Group which includes listed companies such as Godrej Industries, Godrej Consumer Products, Godrej Properties, Godrej Agrovet, Astec Lifesciences as well as Godrej Seeds and Genetics and Anamudi Real Estates along with their respective subsidiaries and joint ventures will have Mr Nadir Godrej as chairperson and will be controlled by Mr. Adi Godrej, Mr. Nadir Godrej, and their immediate families. Adi Godrej’s son, Mr Pirojsha Godrej will be the executive vice chairperson of GIG and will succeed Nadir Godrej as the chairperson in August 2026.
While the Godrej Enterprises Group (GEG) of companies including unlisted Godrej & Boyce Manufacturing Company, Godrej Holdings Private Limited and Godrej Infotech Limited and all of their respective subsidiaries and joint ventures will now be controlled by Mr. Jamshyd Godrej as chairperson and managing director and Ms. Nyrika Holkar as executive director along with their immediate families. The family statement mentions that members of the Adi B Godrej (ABG) family and Nadir B Godrej (NBG) family will not be directly or indirectly involved in the management and operations of entities under the control or management of the Jamshyd Godrej (JNG) family and his sister Smita Crishna-Godrej (SVC) family.
Likewise, the members of the JNG family and SVC family will not be directly or indirectly involved in the management and operations of entities under the control or management of the ABG family and NBG family. While on the usage of the ‘Godrej’ brand, the ABG family and NBG family will have exclusive rights to adopt, use, own, and register the ‘Godrej’ name and brand in businesses such as fast-moving consumer goods (including cosmetics, domestic and cleaning supplies, sanitary care, toiletries), foods and beverages, dairy products, financial services, pharmaceuticals, pharmacy, diagnostics, agriculture and agriculture-related services, fertilisers, chemicals, oils, and fats, among others., other than to the limited extent specifically agreed. On the other hand, the JNG family and SVC family will have the exclusive right to adopt, use, own, and register the ‘Godrej’ name and brand in businesses such as space, aerospace, defense, furniture, durables, heavy engineering, locks and architectural hardware, EPC services, construction materials, home and office automation services, home and commercial interior design services, medical devices, software solutions, IT/ITeS, machines, energy, electric mobility business, vending machines, security products and solutions, intra-logistics, transmission systems, among others.
Additionally, the ABG and NBG family will have the exclusive right to adopt, use, own, and register the ‘Godrej’ name and brand in connection with the development, and marketing of real estate projects and real estate services relating to sale and/or purchase, of real estate projects, and the business of leasing or licensing to third parties. The JNG and SVC family will have the exclusive right to adopt, use, own, and register the ‘Godrej’ name and brand for the real estate development business and the leasing/licensing business carried out in respect of any land parcels (including the land in Vikhroli) owned by, or leased as of January 1, 2024 on a long term basis, to the JNG and/or SVC Family or any real estate asset class developed over the existing Godrej & Boyce land parcels by the JNG and/or SVC Family, directly or indirectly through their affiliates. This shall not restrict the ABG and NBG family, directly or indirectly, from using the Godrej brand when acting as development manager pursuant to an agreement with JNG and SVC family and/or their affiliates, of any land parcel owned by JNG and SVC family in Vikhroli, directly or indirectly, at any point of time. Both family groups can undertake businesses (using the ‘Godrej’ brand, along with a distinguishable group-level differentiator) that are not being undertaken by either of them as of January 1, 2024, and which have been agreed as being shared spaces for doing business. Some examples of shared businesses include medical services, hospitals, hospitality, and education, among others. For the differentiator, the JNG and SVC family may, if it is a tagline, use “Godrej Enterprises Group” and ABG and NBG families may use “Godrej Industries Group”, according to the statement. Moreover, the two families have also agreed to a six-year non-compete agreement. The Family Groups have also agreed on certain non-compete protections for their existing and exclusive businesses, which shall apply for six years from the ‘effective date’.
After the non-compete period, a family group can enter into the exclusive business of the other Family Group, without the use of the ‘Godrej’ brand (including in their corporate/ entity names), the statement said. As per equity data compiled by analysts, Godrej group listed stocks have performed decently well in the calendar year 2024 with Godrej Properties being the top performer followed by Godrej Industries, Astec Lifesciences, and Godrej Consumer Products. Analysts argue that the split will allow each group to be better off financially and the stakeholders with their listed companies will get a better value in the market. Improved valuation will be helped by a consensus decision and operation with no difference of opinion spurring long-term shareholder value. It has been proposed that Godrej Properties would act as the property development manager on the Godrej & Boyce-owned land in Vikhroli and for its services to receive 10% of the total revenue generated from this development. Due to the result of this realignment under the family settlement, the members of ABG family and NBG family will make an open offer to the public shareholders of Astec Lifesciences, an indirect subsidiary of Godrej Industries, in terms of regulations 3 and 4 read with regulation 5(1) of the Sebi’s Substantial Acquisition of Shares and Takeovers (SAST) Regulations, due to indirect change in shareholding of Astec Lifesciences.
It is a leading exporter of Agro chemicals from India to over 25 countries globally having built a strong reputation for manufacturing quality crop protection products through its innovation focus and capabilities in the agrochemicals domain. Through its brand new research and development center, Astec intends to transform the growth journey to make the company a preferred choice when it comes to custom manufacturing.
Investors can do their due diligence on the listed Astec Life Sciences stock currently quoting at Rs 1300 on the bourses and check with their financial advisors about the worthiness of the company. Brokers and analysts tracking the Astec stock and the Godrej group’s recent settlement agreement are bullish on the Astec Life Sciences stock for medium-term appreciation on the horizon.