UPL Share Price Plunges Nearly 17% After Major Restructuring Announcement

Amid the fall, UPL has turned its yearly gains in to neagave 0.91%, though the stock remains up 38% over the past two years.

Creation of World’s Second-Largest Pure-Play Crop Protection Platform

On February 20, 2026, the Board of Directors of UPL approved a composite scheme of arrangement designed to unlock shareholder value and simplify its corporate structure. The restructuring will result in two distinct listed entities: a diversified agriculture and speciality chemicals platform (UPL 1) and a dedicated global crop protection platform (UPL 2), which management expects to become the world’s second-largest listed pure-play crop protection company.

UPL 2, to be named UPL Global Sustainable Agri Solutions Limited, will operate in more than 140 countries and unify the company’s India and international crop protection businesses under one integrated structure.

Three-Step Restructuring Plan

The reorganisation will be executed in three stages. First, UPL Sustainable Agri Solutions Limited (UPL SAS), the Indian crop protection arm in which UPL holds a 90.91% stake, will be amalgamated into UPL Limited. Second, the Indian crop protection business will be vertically demerged from UPL into UPL Global (UPL 2). Third, UPL Crop Protection Holdings Limited (UPL Cayman/UPL Corp), through which UPL holds a 77.78% stake in its international crop protection business, will be amalgamated into UPL Global.

This consolidation will house both India and international crop protection operations under UPL Global, which will subsequently be listed on Indian stock exchanges.

Alongside this restructuring, the group also plans to pursue Advanta’s IPO, consolidating its seeds and Decco businesses.

Strategic Rationale: Value Unlocking and Simplification

Management stated that the restructuring aims to eliminate the conglomerate discount and enable clearer value discovery by creating independently benchmarkable pure-play businesses. UPL 1 will remain the listed parent entity, functioning as a diversified agriculture and speciality chemicals platform while incubating new sustainable ventures. UPL 2 will operate as a focused global crop protection platform.

The company believes this structure will enhance transparency, sharpen strategic focus, drive operational synergies across research, manufacturing, and market access, and provide flexibility for subsidiary-level capital raises. The move is also expected to accelerate deleveraging and strengthen the pathway to valuation re-rating over time.

Shareholding Structure and Governance Highlights

Under the approved swap ratio, shareholders of UPL 1 will receive one share of UPL 2 for every one share held. Specific exchange ratios have also been determined for the mergers involving UPL SAS and UPL Cayman.

To signal long-term commitment, members of the promoter group have voluntarily agreed to an 18-month lock-in period on their shares in UPL 2 starting from the date of listing. The Upswing Trust will swap its holdings to become a public shareholder in UPL 2 with a 16.78% stake and the right to nominate one non-executive director.

Financial Profile and Debt Position

For the financial year ended March 31, 2025, UPL 1 reported a standalone turnover of ₹53,313 million, while UPL Cayman recorded a turnover of USD 4,187 million. The demerged India crop protection undertaking accounted for approximately 31.15% of the combined turnover of UPL 1 and UPL SAS.

Importantly, the restructuring is cash and tax-neutral and does not alter the overall capital structure. Total debt remains broadly similar, though it will be redistributed between the two entities. Net debt for UPL Global is expected to be around ₹19,000 crore, while the standalone business will carry approximately ₹3,200 crore.

Timeline and Regulatory Approvals

The transaction is expected to be completed within 12 to 15 months, subject to approvals from SEBI, NCLT, CCI, RBI, and the company’s shareholders and creditors.

Why the UPL Share Price Fell?

Despite the long-term strategic rationale, investors reacted negatively due to concerns over persistent debt levels, the absence of immediate deleveraging benefits, and potential dilution following restructuring. The recent run-up in the stock also likely contributed to profit booking. As a result, UPL shares witnessed a sharp correction as markets digested the implications of the structural overhaul.