RIL trims Asian Paints stake: Rs 7,700 crore deal shifts shareholding balance

Reliance Industries Limited (RIL) has significantly reduced its stake in Asian Paints by selling 3.5 crore equity shares at Rs 2,201 apiece, in a deal valued at approximately Rs 7,700 crore. This transaction, executed through RIL's subsidiary Siddhant Commercials Limited, has altered the shareholding pattern, with RIL now holding 8.7 million shares.

Following the block deal, Asian Paints shares rose over 2%, closing at Rs 2,263.95 on the BSE, marking the biggest single-day jump in a month. However, the company has been grappling with challenges, including a decline in market share from 59% to 52% in FY25, as reported by Elara Securities.

Asian Paints has experienced muted revenue growth for four consecutive quarters, attributed to sluggish urban demand and an early Diwali festival. The paint industry continues to face weak demand conditions, impacting financial performance. The company reported a net profit of Rs 692 crore in Q4 FY25, falling short of brokerages' expectations of Rs 1,069 crore.

The Life Insurance Corporation of India (LIC) remains the largest public institutional investor in Asian Paints, holding an 8.29% stake. The recent stake sale by RIL represents a strategic shift in ownership dynamics within the company.

"The weak demand conditions prevalent for the past few quarters continued to affect the paint industry even in the last quarter of the financial year," said Amit Syngle, Managing Director & CEO of Asian Paints.

This sizable transaction and the evolving market conditions highlight the challenges and changing landscape for Asian Paints amid a competitive and fluctuating market environment.

Reliance Industries Ltd sold 3.5 crore shares of Asian Paints at Rs 2,201 each, in a Rs 7,700 crore deal, shifting shareholding balance. Asian Paints shares rose over 2% post-transaction, while the company faces declining market share and muted revenue growth amid weak demand.