Apollo Pipes Ltd, a part of the APL Apollo group, has acquired a 53.57% majority stake in Kisan Mouldings Ltd (KML) for ₹118.40 crore, aiming to strengthen its presence in the PVC pipes and fittings sector.
In an exchange filing on Tuesday, Apollo Pipes disclosed that it acquired the stake through a preferential issue of 6,40,00,000 equity shares priced at ₹18.50 per share, with a face value of ₹10 each. This investment has elevated Kisan Mouldings to the status of a subsidiary of Apollo Pipes.
The enterprise value of Kisan Mouldings stands at ₹260 crore, with Singhi Advisors & Financial Services LLP serving as strategic and financial advisors for the transaction.
Apollo Pipes’ Chairman and Managing Director, Sameer Gupta, highlighted the strategic and financial alignment of the acquisition, emphasizing the synergies and market opportunities it brings. With KML’s extensive experience of nearly 35 years in the PVC industry and a wide range of stock keeping units (SKUs), the merger is expected to unlock synergistic benefits and support Apollo Pipes’ geographical expansion, particularly in the western and central regions of India, leveraging KML’s extensive network.
Gupta expressed confidence in rapidly scaling the business by leveraging Apollo’s strengths in financial management, raw material procurement, and system and process implementations.
Despite challenges such as financing working capital, high operating expenses, and inefficiencies in raw material procurement, KML has maintained a revenue of ₹291 crore over the last 12 months. The company operates four plants across a built-up area of 7.34 lakh sq ft but has faced challenges due to inadequate funding for facility upgrades.
KML boasts a dealer network with over 100 dealers and 10,000 retailers, showcasing its strong market presence.
Market estimates project the Indian plastic pipes industry to reach a market size of approximately ₹550 billion by FY26, with the organized market accounting for 65% and the unorganized market at 35%. The industry has shown a growth rate of around 10% CAGR over the last decade and is expected to grow at 12-14% CAGR in the coming years, driven by robust demand from tier 1 and tier 2 cities alongside supportive governmental policies, positioning Apollo to benefit from this growth trajectory.