Aarti Industries (AIL), a leading manufacturer and exporter of chemicals and pharmaceuticals, in its board meeting has in-principally recommended to demerge its Pharmaceutical and Home & Personal Care segment into separate entities in FY 15-16. These segments are distinct and have independent operations by itself and don't have any inter-segment linkages with the other segments.

AIL has been investing in these segments for various expansion and debottlenecking activities, and all these segments are expected to grow. The demerger shall facilitate special attention to each of these segments.

The manufacturing units of Pharmaceuticals are located at Tarapur, Dombivali in the State of Maharashtra and Vapi in the State of Gujarat, while the manufacturing units of Home & Personal Care segment are located in the Union Teritorry of Silvassa and at Pithampur in the State of Madhya Pradesh.

Thus the board expects that the proposed demerger would lead to more focused approach for the growth and success of these three segments and thus would also facilitate increase in shareholders' value.

Shares of the company gained Rs 2.75, or 0.93%, to trade at Rs 297. The total volume of shares traded was 28,286 at the BSE (3.32 p.m., Tuesday).