Asian Paints has received regulatory approval for the amalgamation of its wholly-owned subsidiary Asian Paints (Polymers) Private Limited. The National Company Law Tribunal (NCLT) Mumbai Bench sanctioned the scheme of amalgamation on 10th March 2026, marking a significant step in the company's operational consolidation strategy.

NCLT Order Details

The tribunal's order, pronounced by Member (Technical) Prabhat Kumar and Member (Judicial) Sushil Mahadeorao Kochey, approved the merger under Sections 230-232 of the Companies Act, 2013. The scheme involves the absorption of Asian Paints (Polymers) Private Limited into Asian Paints Limited as a going concern.

Company Background and Rationale

Asian Paints (Polymers) Private Limited was incorporated on 11th January 2023 as a wholly-owned subsidiary to manufacture Vinyl Acetate Monomer (VAM) and Vinyl Acetate Ethylene Emulsion (VAE) for captive consumption. The subsidiary is establishing manufacturing facilities in Dahej, Gujarat, with capacities of 50,000 tons per annum for VAE and 1,00,000 tons per annum for VAM.

The amalgamation is designed to achieve multiple strategic objectives:

• Operational Synergies: Strengthening organizational capabilities around operational and financial areas through resource leveraging
• Cost Optimization: Reducing multiplicity of legal and regulatory compliances while generating economies in administrative costs
• Enhanced Capabilities: Pooling talent and human capital with diverse skill sets in design, sourcing, and consumer insights
• Simplified Structure: Facilitating consolidation for effective management and group structure simplification

Financial and Capital Structure

The scheme involves no share issuance by Asian Paints Limited, as the transferor company is wholly-owned. The authorized share capital details are as follows:

As part of the scheme, Asian Paints Limited's authorized share capital will automatically increase by the aggregate authorized capital of the subsidiary, with appropriate reclassification from ₹10 shares to ₹1 shares.

Implementation Timeline and Next Steps

The scheme will become effective from the date of filing certified copies of the NCLT order with the Registrar of Companies, Mumbai. Both companies must complete this filing within 30 days of receiving the certified order copy.

Key implementation requirements include:

• Filing Form INC-28 electronically with the Registrar of Companies
• Lodging certified copies with the Superintendent of Stamps for stamp duty adjudication within 60 days
• Compliance with all statutory requirements under the Companies Act, 2013
• Continuation of all existing contracts, licenses, and regulatory approvals

Regulatory Compliance and Benefits

The NCLT noted that no objections were received from statutory or regulatory authorities, and the Official Liquidator confirmed that the transferor company's affairs were conducted without prejudice to public interest or creditor interests. The scheme complies with amalgamation definitions under Section 2(1B) of the Income Tax Act, 1961.

Upon effectiveness, Asian Paints (Polymers) Private Limited will be dissolved without winding up, with all assets, liabilities, contracts, and employees transferring to Asian Paints Limited. The company has confirmed there will be no material impact on its financials from this amalgamation.

The successful completion of this merger will enable Asian Paints to integrate its polymer manufacturing operations directly, supporting its strategy to manufacture key raw materials for environmentally friendly paints while optimizing operational efficiency and regulatory compliance.

Asian Paints promoter entity Sattva Holding and Trading Private Limited has pledged an additional 5,00,000 equity shares of the paint manufacturer to Bajaj Finance Limited as loan collateral. The pledge was created on March 2, 2026, with the disclosure filed to stock exchanges on March 5, 2026, pursuant to SEBI's Substantial Acquisition of Shares and Takeovers (SAST) regulations.

Share Pledge Details

The latest pledge transaction has increased Sattva Holding's total encumbered shareholding in Asian Paints significantly. The company's encumbrance position shows a clear progression in its financing activities.

Updated Shareholding Position

Following this pledge creation, Sattva Holding's encumbered shareholding in Asian Paints has reached substantial levels. The promoter entity maintains a significant stake in the paint manufacturer while utilizing a portion as collateral.

Promoter Group Overview

The disclosure also provides comprehensive details of the entire promoter group's shareholding in Asian Paints. The promoter group collectively holds 50,47,85,198 shares, representing 52.63% of the company's total share capital. Among the promoter group entities, several maintain significant individual stakes:

• Smiti Holding and Trading Company Private Limited: 5,14,42,638 shares (5.36%)
• Geetanjali Trading and Investments Private Limited: 4,57,06,140 shares (4.77%)
• Elcid Investments Limited: 2,83,13,860 shares (2.95%)
• Shubhit Holdings Private Limited: 2,31,50,730 shares (2.41%)

Regulatory Compliance

The disclosure was made under Regulation 31(1) and 31(2) of the SEBI SAST Regulations 2011, which mandate promoters to inform stock exchanges about any encumbrance creation, invocation, or release on their shareholdings. Sattva Holding, formerly known as Isis Holding and Trading Company Private Limited, filed the disclosure through its CEO, CFO & Principal Officer Percy Dajee.

Total Group Encumbrance

Across the entire promoter group, the total encumbered shareholding stands at 4,67,89,727 shares, representing 4.88% of Asian Paints' total share capital. This includes encumbrances by various promoter entities, with Smiti Holding and Trading Company Private Limited holding the largest encumbered position at 3,53,15,000 shares (3.68% of total capital).

The pledge arrangement reflects the promoter group's financing strategies while maintaining their substantial ownership in one of India's leading paint manufacturers. Asian Paints shares are listed on both BSE Limited and National Stock Exchange of India Limited.