Adhesive manufacturer Pidilite plans to buy the NBFC company of the promoter group and join the lending market

 Adhesive manufacturer Pidilite plans to buy the NBFC company of the promoter group and join the lending market

Pidilite Industries, a manufacturer of adhesives and construction chemicals, plans to join the banking industry and provide small-value retail loans. "Adhesive maker Pidilite to enter lending business, to acquire promoters group's NBFC firm" In order to make this possible, Pidilite Industries will buy Pargro Investments, an established NBFC that is a component of the Promoter Group, corresponding to a regulatory update.

"New Delhi: Pidilite Industries, a maker of construction chemicals and adhesives, intends to go into the lending market by offering small-value retail loans. According to a regulatory update, Pidilite Industries will purchase Pargro Investments, an existing NBFC that is a part of the Promoter Group, in order to achieve this.

The firm said, "Pidilite Industries Ltd. aspires to set up a Lending Business."

The firm plans to spend up to Rs 100 crore in tranches over the next two years to establish the new business, using an ideal blend of loan and equity.

"The new company would provide recognition to its domain ecology in order to bolster its expansion. Small-value retail loans will be the main means of obtaining this credit, according to Pidilite, the company behind Fevicol, Dr. Fixit, Fevikwik, and M-Seal.

Through a wholly-owned subsidiary and a Share Purchase Agreement (SPA) to be signed by March 31, 2024, Pidilite is going to buy Pargro.

"The acquisition of Pargro is going done at a fair value of up to Rs 10 crore, which is roughly equivalent to the funds that were liquid lying in Pargro's books as on October 31, 2023, as per valuation accomplished by an independent valuer," it said.

It also said that legislative and regulatory compliance will apply to the transaction.

"The transaction will be executed post execution of the SPA and necessary documents and upon attaining the necessary RBI approvals," said Pidilite Industries.

Prior to this, Pidilite Industries had entered the paint industry by introducing Haisha Paints in a few regions.

Pidilite Industries said on Wednesday that its consolidated net profit for the second quarter, which ended in September 2023, increased by 35.76 percent to Rs 458.53 crore. Its operating income increased by 2.15 percent to Rs 3,076.04 crore.