Akzo Nobel India shares rally 6% as JSW Paints to acquire stake worth Rs 8,986 crore

Mumbai, June 27, 2025 – Akzo Nobel India shares surged nearly 6% in Thursday’s trading session after news broke that JSW Paints is set to acquire a substantial stake in the Dutch multinational’s Indian arm for ₹8,986 crore. The development has triggered significant investor interest, buoyed by expectations of synergies, market expansion, and a reshaped competitive landscape in India's growing decorative paints segment.

JSW Paints Makes a Bold Bet on India’s Paint Sector

JSW Paints, part of the Sajjan Jindal-led JSW Group, announced its intention to acquire a strategic stake in Akzo Nobel India Ltd., the Indian subsidiary of the Amsterdam-headquartered AkzoNobel N.V., in what is seen as one of the largest transactions in the Indian paints industry.

In a joint press release, both companies stated that the proposed investment of ₹8,986 crore would translate into the acquisition of approximately 51% stake, making JSW Paints a majority stakeholder, subject to regulatory approvals.

The deal is aimed at combining JSW Paints’ aggressive expansion strategy and Akzo Nobel India’s established presence, especially in the premium paint and coatings segment.

Market Reacts Positively

Akzo Nobel India’s shares closed the day at ₹2,387.40, up 5.9% from the previous close on the NSE. The counter saw an unusually high volume of trading with over 2 million shares exchanging hands compared to the average daily volume of 400,000.

In contrast, JSW Paints, which is privately held, is not listed on Indian stock exchanges. However, the news created ripples across other listed peers in the paints sector, with Asian Paints, Berger Paints, and Kansai Nerolac witnessing marginal intraday volatility.

Analysts See Strategic Long-Term Gains

Market analysts believe this is a strategic masterstroke by JSW Group, which is aiming to deepen its footprint in the fast-growing decorative and industrial paints segment.

“This move puts JSW Paints in direct competition with legacy players like Asian Paints and Berger, especially in the premium category,” said Harsh Mehta, Equity Strategist at Axis Securities. “Akzo Nobel brings with it strong brand equity, R&D capabilities, and international standards, which can help JSW scale its operations faster.”

Manisha Varma, Senior Analyst at JM Financial, remarked: “The combined entity will benefit from Akzo Nobel India’s robust product portfolio and JSW’s strong distribution and capital capabilities. This deal also brings diversification for JSW Group, which has traditionally been focused on steel, energy, and cement.”

A Changing Competitive Landscape

The Indian paints market, valued at over ₹70,000 crore, has seen increasing competition in recent years. While Asian Paints still holds the lion’s share, newer entrants like Grasim’s Birla Opus and JSW Paints have begun shaking up market dynamics.

Akzo Nobel India, known for its Dulux brand, has historically maintained a focused premium market strategy. However, with JSW's backing, the company may adopt a more aggressive volume-led growth strategy to tap into Tier II and III cities and expand its reach.

Deal Structure and Strategic Alignment

As per sources familiar with the matter, the transaction will be executed via a combination of preferential allotment and open market purchases. The ₹8,986 crore deal is likely to include a premium of approximately 20% over the last traded price, indicating the strategic value JSW Paints places on the acquisition.

Akzo Nobel N.V. is expected to continue as a technical collaborator, allowing access to its international research hubs and product innovation pipelines.

“JSW’s focus remains on expanding our consumer-facing verticals, and this is a natural progression from our investment into cement and paints. We are confident this acquisition will create long-term value for all stakeholders,” said Parth Jindal, Managing Director of JSW Paints, in a post-announcement media interaction.

Investor Outlook and Regulatory Hurdles

Investors appear bullish on the deal, anticipating a rerating of Akzo Nobel India due to fresh capital infusion, improved efficiencies, and access to JSW’s extensive distribution ecosystem.

However, analysts caution that regulatory approvals from the Competition Commission of India (CCI) and Securities and Exchange Board of India (SEBI) will be crucial in determining the timeline and smooth execution of the deal.

“From an investor perspective, it’s important to wait for clarity on the shareholding structure and post-merger integration roadmap. If executed well, the merger could drive earnings CAGR of 18–20% over the next 3–5 years,” noted Varun Shah, Fund Manager at HDFC Mutual Fund.

The proposed stake acquisition by JSW Paints marks a significant shift in India’s paints industry, underscoring the increasing interest in consumer-centric sectors by traditionally industrial conglomerates. For Akzo Nobel India, this could mark the beginning of a new growth chapter fueled by fresh capital, stronger market positioning, and enhanced operational muscle.

Investors and industry watchers will now closely monitor how swiftly the regulatory approvals are granted and how the integration process is managed to realize the full value of this landmark transaction.