Shares of CE Info Systems, the owner of homegrown digital map company MapmyIndia, tanked as much as 9% on to hit a 52-week low on Tuesday after the firm said it is spinning off its business-to-consumer (B2C) digital business into a separate entity.

As part of the related-party transaction, the new entity will be using MapmyIndia’s retail brand Mappls, which competes with Google Maps in India. Rohan Verma, CEO and executive director of MapmyIndia, will float a B2C new venture.

The company said Rohan will relinquish all executive responsibilities in the company and continue to be on the MapmyIndia board as a non-executive director with effect from April 1, 2025. “MapmyIndia will take 10% stake and provide an additional funding of ₹35 crore via CCD in the new company,” it said in a statement.

Rohan will hold 90% stake in the new company while the balance 10% will be with MapmyIndia. The company will also be subscribing to ₹35 crores worth of CCDs of the new company. The CCD will convert to equity either after 10 years or at a 25% discount to any 3rd party valuation of new company whichever is earlier.

Reacting to the related-party transaction, shares of CE Info Systems continued their downward trend on Tuesday to hit a 52-week low of ₹1,538.45 on the BSE.

“As the consumer business requires a dedicated focus to build Rohan Verma, CEO and executive director of MapmyIndia proposed to the board to fund a new venture outside the company. The proposed consumer business will complement and showcase MapmyIndia’s core market strength of B2B and B2B2C, while focusing exclusively on the B2C segment. The MapmyIndia board approved a funding of ₹35 crore by way of CCD in addition to acquring 10% equity stake in the start-up. Rohan Verma will now be able to fully focus on the consumer business,” the company says.

“MapmyIndia will continue to focus on its core B2B and B2B2C business, which has a large and growing addressable market, and where MapmyIndia is the market leader with a strong track record of growth and profitability. MapmyIndia leadership continues to be spearheaded by us founders, myself and Rashmi Verma, along with our able and established management team” says Rakesh Verma, co-founder and chairman and managing director of MapmyIndia.

“Mappls Mall and Travel which is in the incubation stage will be transferred to the new company along with Mappls gadgets for consumers marketed through D2C or ecommerce channels. MapmyIndia will have access to anonymised data collected by the Mappls app to improve MapmyIndia's map data. The new company will operate as an independent entity and bear all expenses related to its business be it people cost, marketing cost and cloud cost,” the company statement says.

CE Info Systems said the related-party transaction has been “considered carefully by the board.” “MapmyIndia founders (Rakesh Verma and Rashmi Verma) will have no part in the new entity. They will be completely focused on building MapmyIndia and have no other interests beyond MapmyIndia and will continue guiding the company towards new growth trajectories without any distractions. While Rohan can concentrate his energies on building the B2C business,” the statement said.

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MapMyIndia shares crash 9% as company hives off B2C biz