* Shares rise more than 9% to hit all-time high

* Proposes interim dividend of 63 AU cents per share

* Potential demerger part of strategic review

March 26 (Reuters) - Australian specialty retailer Premier Investments said on Tuesday it was exploring a demerger and separate listings of its Smiggle and Peter Alexander brands while reporting a rise in half-year profit, sending its shares to a record high.

Shares of the company rose 9.3% to an all-time high of A$33.510 before paring some of the gains. The stock was among the top gainers in the benchmark index, which was down 0.4% as of 2341 GMT.

The potential demerger is part of a strategic review, which began in August 2023 with a particular focus on Smiggle, Peter Alexander and apparel brands.

Premier Investments said it was working towards the demerger of stationary brand Smiggle by the end of January 2025 and designer sleepwear brand Peter Alexander in the calendar year 2025.

"The ongoing strategic review has identified that the potential demerger of Smiggle and Peter Alexander is likely to maximise and accelerate the growth opportunities for these two brands over time," Chairman Solomon Lew said in a statement.

The fashion retailer posted a near 1.7% rise in half-year net profit to A$177.2 million ($115.87 million) and declared an interim dividend of 63 Australian cents per share.

Premier Retail posted global sales of A$879.50 million, of which Smiggle accounted for A$183.90 million and Peter Alexander A$279.30 million.

"Work towards demerging Peter Alexander and Smiggle separately raises questions around dis-synergies," analysts at Citi wrote in a note. "Favourable rental negotiations may be harder to achieve as three separate entities."

The company also announced expansion plans for Peter Alexander and Smiggle, with Peter Alexander planning to open its first two stores in the UK before Christmas 2024 and Smiggle planning to open standalone stores in Indonesia.

"We think the market is under-appreciating the roll-out potential for both brands," Citi analysts wrote. ($1 = 1.5293 Australian dollars) (Reporting by John Biju in Bengaluru; Editing by Krishna Chandra Eluri, Vijay Kishore and Subhranshu Sahu)