Refex Industries is the top gainer on the BSE since the morning today; it is seeing a two-day breakout rally, up 22% since the demerger announcement, with strong volumes and investor optimism around value unlocking. Currently trading at Rs.394 levels, its 52-week high stands at Rs.600.

The positive buzz around the stock is on account restructuring and a demerger which is creating another listed entity.

The company’s restructuring involves first merging Refex Green Mobility Limited (RGML), currently a wholly owned subsidiary, to be merged into Refex Industries Ltd (RIL). This is more of a housekeeping step to consolidate all “green mobility” assets under the parent first.

After the merger, the “Green Mobility Business” unit will be spun out of RIL into a new company called Refex Mobility Ltd (RML).

The market is more happy because RML will be separately listed on the BSE and NSE and shareholders of RIL will get shares of RML in 1:1 ratio.

So there will now be two listed companies - RIL (Ash & Coal handling, power-related services - the legacy/core business) and RML (Green mobility — sustainable corporate transport using clean-fuel vehicles).

This is expected to unlock value, improve focus, and allow each business to attract its own set of investors.