Aditya Birla Group Puts Price On Its Brand; Hindalco, Grasim, Novelis To Pay 0.25% Royalty

The Aditya Birla Group has introduced a new brand royalty framework under which its listed operating companies will pay 0.25% of their revenue for using the group name.

The arrangement took effect from June 1, 2026, with the annual royalty capped at ₹225 crore for each entity, as per a report by Moneycontrol.

Grasim Industries will pay 0.25% of its standalone revenue to the promoter group under the framework.

Grasim Managing Director Himanshu Kapania said during the company's earnings call that, based on estimated revenue of ₹50,000 crore, the annual royalty outgo would be about ₹125 crore, below the prescribed ceiling, the report said.

Citi has estimated Grasim's royalty at 0.25% of standalone revenue, while Jefferies expects the annual cost to be around ₹100-120 crore, or less than 5% of the company's EBITDA, it added.

The new framework brings brand-use payments into a formal structure across the Aditya Birla Group's listed operating businesses, with the ₹225-crore cap limiting the annual royalty payable by each entity.

Hindalco, Novelis Royalty From FY27

Hindalco Industries and its US-based subsidiary Novelis will also pay 0.25% of revenue as brand royalty from FY27, subject to the ₹225-crore annual limit for each entity.

The framework came up during Hindalco's Q1 FY27 earnings call on August 7, after a question on a royalty disclosure in Novelis's 10-Q filing, per the Moneycontrol report.

Hindalco Managing Director Satish Pai reportedly said the Aditya Birla brand is owned by Birla Group Holdings Private Limited (BGH), which had not previously charged group companies for using its trademarks. Pai described this as an exception among large Indian conglomerates.

Pai said the new arrangement represented "the transition from family-driven stewardship to structured governance" and that the royalty would be used to invest in and strengthen the brand.

He also said the amount would remain below Hindalco's materiality threshold and would not affect the company's capital allocation or dividend policy.

Disclosure Under SEBI Rules

Hindalco will disclose the related-party transaction through exchange filings due in October, as per Moneycontrol.

The disclosure will be made under SEBI's Listing Obligations and Disclosure Requirements (LODR) framework, which requires listed entities to provide biannual disclosures of related-party transactions.