Latest news with #KumarMangalamBirla
Mint
21 hours ago
- Business
- Mint
JSW fires a fresh salvo even as paintmakers battle to protect turf
Mumbai: India's paintmakers must gird up for a tougher battle from two upstarts. Birla Opus, owned by billionaire Kumar Mangalam Birla, has already shaken up the nation's paints sector with its pricing war. Now, JSW Paints Ltd's ₹9,300-crore acquisition of Dutch giant AkzoNobel's India unit portends a tighter squeeze on the profitability of their peers as they battle to protect turf. The deal by JSW Paints, part of billionaire Sajjan Jindal's steel-to-cement empire, will not immediately change the competitive landscape as it merely changes ownership from a multinational to a local player, according to Abneesh Roy, executive director for research at Nuvama Institutional Equities. 'But this is positive for JSW Paints. Over the next five years, we see Kansai, Akzo + JSW, Birla fight for the No. 3,4,5 slots, and also take some share from [other] local players." The sector is already grappling with tepid demand for decorative paints due to a slowdown in new construction and elongating repainting cycles. Birla Opus' discounting to win over market share is squeezing the profitability of incumbents. India's largest paintmaker Asian Paints Ltd's operating margin shrank to 17.7% in FY25 from 21.4% in FY24. To be sure, India's paints industry is expected to reach $15.04 billion by 2029, growing at an annualized rate of 9.38% from nearly $9.60 billion in 2024, according to a report by ICICI Direct. But the entry of two billionaire-led upstarts in the past half a decade has shaken up the long-standing leaderboard. While the exact market shares differ based on products such as decorative and industrial paints and associated materials like coatings and putty, industry insiders estimate that Birla Opus has achieved a podium position this year, and the JSW-AkzoNobel combine is within a striking range of the fourth position. They estimate the new pecking order as: Asian Paints, Berger Paints India, Birla Opus, Kansai Nerolac, JSW Paints (including Akzo Nobel India) and Indigo Paints. Analysts at Nuvama expect Asian Paints and Berger Paints to put up a fight to protect their sales. They are also positive on Indigo Paints. The companies are expected to snatch share from unorganized players, who still hold around 25% of the market. While the two upstarts have cornered market share from the incumbents rapidly, growth may be more challenging from here. 'A proper integration after acquisition is essential. Simply acquiring a company will not make you a strong player overnight. You have to work on multiple things before you are a force to be reckoned with," said an analyst on JSW Paints disrupting the market. He spoke on the condition of anonymity as he is not allowed to comment on an individual company before publishing a report. The $23-billion JSW Group, which started as a mining company, has diversified across key sectors like infrastructure, cement, e-commerce platforms and paints. JSW Infrastructure and JSW Energy are listed on the country's stock exchanges. JSW Cement got the market regulator's nod for going public in January. JSW Paints, launched in 2019, has a portfolio spanning decorative and industrial paints. The privately held JSW Group firm will acquire 74.76% in listed Akzo Nobel India Ltd from its Dutch parent Akzo Nobel N.V. and its affiliate for ₹8,986 crore, the company said in a press release. The transaction is priced at ₹2,639.4 per share, a 17.32% discount to Thursday's closing price, according to Mint calculations. In a post on X, JSW Paints managing director Parth Jindal, 35, said it was 'a historic day". 'Akzo Nobel India is home to some of the most globally renowned brands of paints & coatings like Dulux, International and Sikkens. We are excited to welcome them to the JSW family," he said in a statement. 'This transaction is a significant milestone in the execution of our strategy. With JSW, we are confident the business is in the hands of a long-term partner with deep local expertise and strong ambitions in the sector," said Greg Poux-Guillaume, the CEO of AkzoNobel. The Dutch paintmaker had hinted at an exit from India in October last year, when it initiated a strategic review of the business. Apart from JSW Paints, Pidilite Industries Ltd and Indigo Paints Ltd were also in the race for acquiring Akzo Nobel India. Indigo paints, which has consolidated market share in recent years, had come close to entering the top 4 club. Meanwhile, adhesives major Pidilite Industries, which lost the race to buy Akzo Nobel India, is also looking to start its paints journey through in-house capacity development. The company plans to target a growing demand for decorative paints in non-urban areas, Mint reported on 27 March.
Mint
a day ago
- Business
- Mint
Retail investors slam Vodafone Idea over user wipeout, stock crash
Retail shareholders ofVodafone Idea Ltd (Vi) raised concerns on Friday over the company's continued loss of subscribers and its fragile financial health. During the extraordinary general meeting (EGM) convened to approve the ₹20,000 crore fundraise, shareholders questioned the management about the lack of upside in the share price and a significant fall, particularly in the aftermath of the follow-on public offer (FPO) last year. The absence of Aditya Birla Group chairman Kumar Mangalam Birla from the meeting also drew concern, with a few shareholders expressing disappointment over his non-attendance. The government is the largest shareholder in Vodafone Idea with a 49% stake, followed by promoters—Vodafone Group at 16.07% and Aditya Birla Group at 9.5%. Retail investors own 14.96% of the company. 'Despite the previous fundraises, including the government conversion, there is no upside in the share price. In fact, the government's equity investment (via dues conversion) in the company has also gone into losses (at the current share price). If the management cannot handle the company, it should consider selling or surrendering it to the government," Santosh Kumar Saraf, a retail shareholder of the company, said during the meeting. Also Read: Faster WiFi plan hits spectrum interference worry Saraf wondered aloud what would happen if the company defaulted even after the fundraiser. Lately, the government has been exploring a resolution on the telecom operator's substantial dues. As of 31 March, Vodafone Idea's total government dues stood at around ₹2 trillion, including ₹1.19 trillion in spectrum dues and ₹83,400 crore adjusted gross revenue (AGR) dues. Mounting expenses In the absence of any relief from the government, starting 31 March 2026, Vodafone Idea will have to pay an annual instalment of over ₹18,000 crore for the next six years towards AGR and spectrum dues to the government. The dues are under moratorium, which will expire in September. In 2025-26 itself, Vodafone Idea will have to pay ₹16,428 crore towards AGR dues and ₹2,539 crore towards deferred spectrum dues. Going by the company's share price performance, the Friday closing share price of ₹7.40 is over 38% lower than the FPO listing price of ₹12 in April last year. In fact, the government's investment in Vodafone Idea through two equity conversions at ₹10 a share has also fallen by 26% at the current share price. In August 2018, when Vodafone Group completed its merger with Idea, the company's share price was ₹30. 'The company needs to focus on increasing its business. Many small investors are stuck in the company for the last so many years," said Redeppa Gunduluru, another retail investor, who has expressed concerns over the losses he incurred recently and the volatile share price. 'Vi's continued subscriber losses and weaker data net adds remain key concerns. Despite potential acceleration in network investments, we believe regaining subscribers will remain a tall ask for Vi, given that peers—with superior free cash flow generation and deeper pockets—can keep customer acquisition costs higher," said analysts at Motilal Oswal in a note dated 2 June. 'Further, with no relief so far on AGR dues (repayments commence March 26) and no breakthrough on the debt raise, we believe Vi is likely to face an annual cash shortfall of ₹20,000 crore and may be unable to meet its capex guidance of ₹50,000-55,000 crore over FY25-27," the analysts said. Narender Chauhan from Uttar Pradesh, another shareholder of the company, asked the management about the company's road map in the next 3-4 years, its plans for pan-India 5G coverage, and clarity on the satcom services launch after its recent collaboration with US-based AST SpaceMobile on direct-to-device connectivity. Dodging queries In an exchange filing on 30 May, Vodafone Idea said its board had approved raising another ₹20,000 crore through a follow-on public offering, private placement, or other permissible mode. The company said a capital raising committee will evaluate and decide on the potential route of fundraising. This fundraising approval comes at a time when the telecom operator is also looking to tie up ₹25,000 crore in bank debt to fund the capex for network expansion. When shareholders asked about the use of the ₹20,000 crore proceeds, the company's chief financial officer Murthy G.V.A.S. said, 'The proceeds will be used for capital expenditure." The management, however, did not address the shareholders' queries about the company's survival and revival concerns and the way forward. Also Read: Next-gen gadgets, WiFi speeds to get boost as India to open up new spectrum Notably, since the merger, Vodafone Idea has raised total equity of around ₹56,000 crore, out of which around ₹27,000 crore has been contributed by the promoters, the company told the Supreme Court in a recent plea to seek waiver on AGR dues from the government. The plea, however, was rejected by the court. In the petition, the telecom company had said it would not be able to operate beyond the current fiscal year without bank funding, which remains elusive as lenders remain wary of its dues worth ₹83,000 crore linked to AGR. On the shareholder questions, Ravinder Takkar, the company's non-executive chairman, said, 'most of the questions were related to items outside the agenda items (of the EGM)." Takkar, however, asked the company to take note of some of the suggestions made by the shareholders. Pinning its hopes Vodafone Idea is set to incur capital expenditure of ₹5,000-6,000 crore for the first half of 2025-26 to enhance its network and infrastructure. However, its next leg of spending would be dependent on funds from banks, the company's CEO, Akshaya Moondra, had said in an earnings call on 2 June. 'I see no reason why the government should be constrained in any way to offer relief…," Moondra had said. Vodafone Idea is the most widely held stock, with over 6 million retail shareholders (more than the State Bank of India), according to the company's letter to the department of telecommunications on 17 April seeking further support. In May last year, Vodafone Idea said it would incur a capital expenditure of ₹50,000-55,000 crore over the next three years to expand its 4G network and launch its 5G service. "Completion of ₹25,000 crore debt-raising is key for executing Vi's ₹50,000-55,000 crore capex programme. Higher government flexibility around AGR dues offers a ray of hope," IIFL Capital said in a note on 2 June. Also Read: Will private 5G networks take off, finally? The retail investors also questioned the company's management about the fall in subscriber base and whether there are any plans to merge with state-owned BSNL. In an interview withMinton 23 April, Union communications minister Jyotiraditya Scindia said there are no plans to merge Vodafone Idea with BSNL. 'I do not think it is necessarily inefficient to have two competing businesses. There are multiple verticals where the government has competing businesses. Also, there was no physical cash outgo in this (Vodafone Idea) conversion. What the government has retained is an upside, no downside," Scindia had said. As of 31 March, Vodafone Idea had 198.2 million mobile subscribers. Even as Vodafone Idea has been losing subscribers for a long time now, the company's subscriber churn rate has slowed down during the March quarter. Compared to the loss of 5 million subscribers each in the September and December quarters, its subscriber churn slowed down to 1.6 million in the fourth quarter.
New Straits Times
2 days ago
- Business
- New Straits Times
JSW strengthens India paints push with US$1.6 billion Akzo Nobel unit deal
BENGALURU: JSW Paints will buy Dutch paint maker Akzo Nobel's Indian arm for about US$1.6 billion, in what will be the country's biggest deal yet in the sector as competition intensifies between established players and new entrants. The deal comes as challenges for Indian paint makers mount, including volatile raw material costs and heightened competition, with billionaire Kumar Mangalam Birla's entry into the sector last year eating into Asian Paints' market share. Dulux Paint-owner Akzo Nobel had announced a review of its South Asia operations last year to rein in costs and boost its core coatings business. Shares of Akzo Nobel India jumped more than 11 per cent after the deal was announced, and were trading 7.6 per cent higher in Mumbai at around 0830 GMT. India's paint and coatings market is expected to reach US$16.37 billion in size by 2030, Mordor Intelligence estimates, from US$10.46 billion in 2025, driven by a boom in infrastructure and real estate development. The deal, which includes debt, will be the Indian paint sector's biggest deal on record, Dealogic data showed. JSW Paints, launched in 2019 and part of the US$23 billion JSW Group, will buy a 74.76 per cent stake in Akzo Nobel India for US$1.05 billion and launch an open offer for the roughly 25 per cent held by public shareholders. Parent Akzo Nobel, the fourth-largest paint maker in the world by market capitalisation behind PPG, Nippon Paint and Sherwin-Williams, will continue to retain its research and development centre and powder coatings business in India. GROWING COMPETITION Once completed, the deal will propel JSW Paints to fourth place by market share in a sector dominated by Asian Paints , Berger Paints and Kansai Nerolac, according to Geojit Financial Services analyst Antu Thomas. Birla-owned Grasim launched Birla Opus in 2024, crowding the already-competitive market. Birla has since filed an antitrust complaint against Asian Paints for allegedly abusing its market position, Reuters has reported. In 2022, the competition regulator closed a case filed by JSW Paints against Asian Paints for abusing its market position, saying it found no breach of competition laws. "While this acquisition offers JSW Paints a significant scale-up opportunity, near-term integration challenges could provide an opportunity for incumbent players to strengthen their market position in the luxury segment," Amit Purohit, vice president at Elara Capital said. Akzo Nobel is likely to rake in 900 million euros in net proceeds and plans to launch a 400 million euro share buyback program after the deal's closing, which is expected in the fourth quarter of 2025.
New Straits Times
2 days ago
- Business
- New Straits Times
JSW strengthens India paints push with $1.6 billion Akzo Nobel unit deal
BENGALURU: JSW Paints will buy Dutch paint maker Akzo Nobel's Indian arm for about US$1.6 billion, in what will be the country's biggest deal yet in the sector as competition intensifies between established players and new entrants. The deal comes as challenges for Indian paint makers mount, including volatile raw material costs and heightened competition, with billionaire Kumar Mangalam Birla's entry into the sector last year eating into Asian Paints' market share. Dulux Paint-owner Akzo Nobel had announced a review of its South Asia operations last year to rein in costs and boost its core coatings business. Shares of Akzo Nobel India jumped more than 11 per cent after the deal was announced, and were trading 7.6 per cent higher in Mumbai at around 0830 GMT. India's paint and coatings market is expected to reach US$16.37 billion in size by 2030, Mordor Intelligence estimates, from US$10.46 billion in 2025, driven by a boom in infrastructure and real estate development. The deal, which includes debt, will be the Indian paint sector's biggest deal on record, Dealogic data showed. JSW Paints, launched in 2019 and part of the US$23 billion JSW Group, will buy a 74.76 per cent stake in Akzo Nobel India for US$1.05 billion and launch an open offer for the roughly 25 per cent held by public shareholders. Parent Akzo Nobel, the fourth-largest paint maker in the world by market capitalisation behind PPG, Nippon Paint and Sherwin-Williams, will continue to retain its research and development centre and powder coatings business in India. GROWING COMPETITION Once completed, the deal will propel JSW Paints to fourth place by market share in a sector dominated by Asian Paints , Berger Paints and Kansai Nerolac, according to Geojit Financial Services analyst Antu Thomas. Birla-owned Grasim launched Birla Opus in 2024, crowding the already-competitive market. Birla has since filed an antitrust complaint against Asian Paints for allegedly abusing its market position, Reuters has reported. In 2022, the competition regulator closed a case filed by JSW Paints against Asian Paints for abusing its market position, saying it found no breach of competition laws. "While this acquisition offers JSW Paints a significant scale-up opportunity, near-term integration challenges could provide an opportunity for incumbent players to strengthen their market position in the luxury segment," Amit Purohit, vice president at Elara Capital said. Akzo Nobel is likely to rake in 900 million euros in net proceeds and plans to launch a 400 million euro share buyback program after the deal's closing, which is expected in the fourth quarter of 2025.
Business Recorder
2 days ago
- Business
- Business Recorder
JSW strengthens India paints push with $1.6 billion Akzo Nobel unit deal
BENGALURU: JSW Paints will buy Dutch paint maker Akzo Nobel's Indian arm for about $1.6 billion, in what will be the country's biggest deal yet in the sector as competition intensifies between established players and new entrants. The deal comes as challenges for Indian paint makers mount, including volatile raw material costs and heightened competition, with billionaire Kumar Mangalam Birla's entry into the sector last year eating into Asian Paints' market share. Dulux Paint-owner Akzo Nobel had announced a review of its South Asia operations last year to rein in costs and boost its core coatings business. Shares of Akzo Nobel India jumped more than 11% after the deal was announced, and were trading 7.6% higher in Mumbai at around 0830 GMT. India's paint and coatings market is expected to reach $16.37 billion in size by 2030, Mordor Intelligence estimates, from $10.46 billion in 2025, driven by a boom in infrastructure and real estate development. The deal, which includes debt, will be the Indian paint sector's biggest deal on record, Dealogic data showed. JSW Paints, launched in 2019 and part of the $23 billion JSW Group, will buy a 74.76% stake in Akzo Nobel India for $1.05 billion and launch an open offer for the roughly 25% held by public shareholders. JSW Steel files review petition before India's top court on Bhushan Power deal collapse Parent Akzo Nobel, the fourth-largest paint maker in the world by market capitalisation behind PPG, Nippon Paint and Sherwin-Williams, will continue to retain its research and development centre and powder coatings business in India. Growing competition Once completed, the deal will propel JSW Paints to fourth place by market share in a sector dominated by Asian Paints , Berger Paints and Kansai Nerolac, according to Geojit Financial Services analyst Antu Thomas. Birla-owned Grasim launched Birla Opus in 2024, crowding the already-competitive market. Birla has since filed an antitrust complaint against Asian Paints for allegedly abusing its market position, Reuters has reported. In 2022, the competition regulator closed a case filed by JSW Paints against Asian Paints for abusing its market position, saying it found no breach of competition laws. 'While this acquisition offers JSW Paints a significant scale-up opportunity, near-term integration challenges could provide an opportunity for incumbent players to strengthen their market position in the luxury segment,' Amit Purohit, vice president at Elara Capital said. Akzo Nobel is likely to rake in 900 million euros in net proceeds and plans to launch a 400 million euro share buyback program after the deal's closing, which is expected in the fourth quarter of 2025.
