Astral Approves Demerger of Chemicals Business and Merger of Al-Aziz Plastics

Astral Approves Demerger of Chemicals Business and Merger of Al-Aziz Plastics

Astral's board has approved the demerger of its chemicals business into a separate listed entity, Astral Chemie, alongside the amalgamation of its wholly owned subsidiary, Al-Aziz Plastics, with the company.

Under the proposed restructuring, Astral will transfer all assets and liabilities related to its chemicals business to Astral Chemie. The chemicals division, which manufactures adhesives, polyvinyl acetate (PVA), cyanoacrylates, solvent cements, silicone sealants, epoxy resins, construction chemicals, putties, paints and coatings, generated a turnover of Rs 1,266.3 crore in FY26, contributing approximately 21% of the company's total revenue. Existing Astral shareholders will receive one equity share of Astral Chemie for every Astral share held.

According to the company, the demerger will allow the plumbing and chemicals businesses to operate independently, enabling each business to pursue focused growth strategies, capacity expansion, product development, market expansion, acquisitions and strategic collaborations.

Astral also approved the merger of Al-Aziz Plastics, which manufactures electrofusion fittings, compression fittings, saddles, electrical fittings and related products. The integration is expected to strengthen Astral's plumbing business by combining manufacturing capabilities, expanding its product portfolio, improving customer reach, and reducing administrative and regulatory compliance costs.

Commenting on the development, Managing Director Sandeep Engineer said the restructuring would provide dedicated leadership, sharper strategic focus and independent capital allocation for both businesses. He added that Astral Chemie will bring together the company's adhesives, sealants, construction chemicals, paints and coatings businesses, creating a focused chemicals platform with opportunities to leverage shared research and development, manufacturing, procurement, branding and distribution capabilities.

Astral is one of India's leading building materials companies, offering a broad portfolio that includes pipes and fittings, adhesives, sealants, water storage solutions, bathware, valves, paints, construction chemicals and infrastructure products.

Following the announcement, Astral's shares declined 8.2% to Rs 1,364.45. The company also reported strong financial results for the fourth quarter of FY26, with consolidated net profit rising 18.8% year-on-year to Rs 213 crore, while revenue from operations increased 24.2% to Rs 2,088.5 crore.

Source: Business Standard