JK Cement Ltd.’s wholly-owned subsidiary JK Paints and Coatings Ltd will buy a 60% stake in Acro Paints Ltd for Rs 153 crore, the company said in an exchange filing. The remaining 40% stake will be acquired over 12 months. The acquisition will enable JK Cement’s entry into the paints business, expand its product offering, and foray into new markets. It will bring manufacturing capabilities and product formulations, which will scale up to meet the business plan objectives for JK Paints & Coatings over the next few years, the company said.
The acquisition will also provide an opportunity to foray into the growing vertical of construction chemicals & waterproofing products. Acro is expanding its capacity to 60,000 KL for decorative and textured paints and to 6,700 KL for construction chemicals, which will be completed by Q2FY24.
Acro Paints manufactures architectural and high-performance paints and coatings in Northern India. JK Paints will continue its association with Acro's promoters, Charanjeet and Ashok Gaind for the next one year, the company informed.
In some ways, J K Cements' entry into the paints market is similar to the plans of Grasim Industries Ltd, of the Aditya Birla group. The company plans to spend approximately Rs 10,000 crores on capital expenditure by FY25, which is twice as much as the investment it originally announced in 2021.