Kansai Nerolac Paints Limited , a leading paint manufacturer in India, has announced a strategic move to consolidate its business operations. The company's Board of Directors has approved a scheme of amalgamation to merge its wholly owned subsidiary, Nerofix Private Limited, with itself.

Key Details of the Merger

• Appointed Date: April 1, 2025
• Regulatory Approvals: The merger is subject to regulatory and shareholder approvals
• Subsidiary Business: Nerofix Private Limited operates in the adhesives and paint-related products business
• Financial Snapshot:

Merger Mechanics

Upon completion of the merger:

• All assets, liabilities, and business operations of Nerofix will transfer to Kansai Nerolac
• Nerofix's shares held by Kansai Nerolac will be cancelled
• No cash consideration or share exchange is involved in the transaction

Strategic Rationale

The merger aims to provide several benefits to Kansai Nerolac:

• Synergy benefits
• Economies of scale
• Enhanced growth opportunities
• Expanded business operations

Impact on Shareholding

There will be no change in Kansai Nerolac's shareholding pattern as this involves a wholly owned subsidiary merger.

Corporate Disclosure

In compliance with regulatory requirements, Kansai Nerolac has made the necessary disclosures to the stock exchanges. The company's filing states:

"The Board Meeting commenced at 2.30 p.m. and concluded at 3 p.m. on Monday, 11th August, 2025. The Scheme of Amalgamation has been approved, subject to the approval of the Equity Shareholders and Creditors of Nerofix Private Limited and our Company, along with necessary approvals from various regulatory authorities."

The merger aligns with Kansai Nerolac's strategy to streamline its operations and leverage the complementary businesses of its subsidiary. As the paint industry continues to evolve, this consolidation may position Kansai Nerolac to better serve its customers and compete effectively in the market.

Kansai Nerolac Paints , one of India's leading paint manufacturers, reported a modest growth in its Q1 financial results, navigating through various challenges in the market. The company's standalone revenue grew by 1.80%, while consolidated revenue increased by 1.40% compared to the same quarter last year.

Financial Performance

The company's financial performance showed mixed results:

Segment Performance

Decorative Segment

• Volume growth remained flat
• Paint+ product range now contributes over 12% of sales with 28 products in the market
• Added 400 new Nerolac NXTGEN shops
• Expanded dealer network to over 30,000 direct dealers

Industrial Segment

• Showed higher single-digit growth
• Automotive business reported market-leading growth despite sluggish demand
• Protective coatings segment reported higher than market growth

Challenges and Impacts

• Early onset of monsoon affected May sales
• Geopolitical tensions impacted sales in the North region
• Continued losses from Bangladesh operations
• Antidumping duty on Chinese titanium dioxide expected to cause 1% to 1.30% inflation in the decorative segment

Strategic Initiatives

• Capitalized Jainpur water-based facility, adding 44,000 KL capacity
• Focusing on strong markets and going deeper with resources
• Expanding into new areas in the auto segment to increase addressable market
• Launched new products in both decorative and industrial segments

Management Commentary

Pravin Chaudhari, Managing Director of Kansai Nerolac, noted, "Dealers are returning to Nerolac from competitors, citing better ROI compared to new competition. We expect quarter 2 to perform better due to earlier Diwali timing and improved construction activity."

Outlook

The company remains cautiously optimistic about the future, expecting improved performance in Q2 due to the festive season and enhanced construction activity. However, challenges such as geopolitical tensions and raw material price volatility continue to pose risks to the business.

Kansai Nerolac continues to focus on innovation, network expansion, and strategic market positioning to navigate through the competitive landscape and drive growth in the coming quarters.