Fortune Scrip     

Published: May 31, 2025
Updated: May 31, 2025

Astral Ltd.

Pied Piper of Indian piping industry!

This time we have picked Astral Ltd, an Ahmedabad (Gujarat)-headquartered mid-cap com pany as the Fortune Scrip for the fortnight. Primarily engaged in the manufacture of CPVC pipes for industrial use, the company has revolutionised the piping industry with world-class innovative solutions. A pioneer in bringing CPVC tech to India and launching the country’s first lead-free UPVC pipes and PVC pipes, Astral has set the benchmark for quality and innovation.

A quarter century ago – in 1996, to be exact — the company set up its first plant at Santej near Ahmedabad to manufacture CPVC pipes under a licence from FBF Goodrich of the US. The technology was a paradigm shift from conventional piping systems, and Astral became the pioneer of CPVC piping systems in India. With an industry-first 25-year warranty on its flagship products Astral continues to reaffirm its commitment to excellence. Known for uncompromising quality, Astral continues to shape the industry with cutting-edge piping technologies, making waves both in India as well as globally.

Having established itself in the pioneering field of CPVC piping systems, Astral diversified its activities by taking up the manufacture of adhesives, sealants and construction paints. The com pany also diversified into bathware by taking up the manufacture of faucets and sanitaryware. Astral also forayed into the water storage tank segment with the introduction of the country’s first anti-viral water tanks with copper shields.

PAINTS FORAY

Subsequently, the company acquired the controlling stake in Gem Paints and ventured into the paints business by taking up the manufacture of decorative paints, industrial paints and preventive paints. Astral endeavours to provide a complete portfolio of paint products and solutions. As a pioneer in CPVC piping systems and with its foray into sanitaryware, adhesives, water storage tanks and paints, the company showcases its commitment to being a one-stop solutions provider for industrial and consumer needs in the real estate space.

Consequent to its fine performance in almost all its product lines, the company has made rapid strides in its financial per formance. During the last 13 years, its sales turnover has expanded more than seven times from Rs 802 crore in fiscal 2013 to Rs 5,832 crore in fiscal 2025, with the operating profit shooting up around eight and a half times from Rs 115 crore to Rs 946 crore and the profit at net level also surging eight and a half times from Rs 61 crore to Rs 519 crore. The company’s financial position is very strong, with reserves at the end of March 2025 standing at Rs 3,590 crore — almost 137 times its equity capital of Rs 27 crore.

Astral which has revolutionised the Indian piping sector has successfully diversified its activities in adhesive sealants, construction paints, water storage tanks, faucets and sanitaryware and decorative as well as industrial paints – in order to showcase its commitment to being a one-stop solutions provider for consumer and industrial needs in the real estate space.

STEADY GROWTH

But we have not picked Astral as the Fortune Scrip just on the basis of its past laurels. We strongly feel that the company’s future prospects are all the more heartening. Consider:

The Astral management headed by Mr. Sandeep Engineer has followed a distinct investor-friendly approach. During the first 25 years of the existence of the company the board has made three bonus issues in the ratio of 1:3 in 2019, in the 1:3 ratio in 2021 and again as 1:3 ratio in 2023. Besides the company has been paying dividends at handsome rates at 225% in the fiscal 2021, at 300 per cent in the FY2022, 375 per cent in the FY2023 as well as in 2024 and 225% in fiscal 2205. The company’s dividend payment percentage during the last five years being 10%, 12%, 21%, 18% and 19% respectively.

• The management is confident of scaling further heights, go ing ahead. The company has maintained its volume growth guidance in the P&F business at 10-15 per cent and revenue growth guidance at 15 per cent for fiscal 2026. It has also maintained its EBITDA margin guidance at 16-18 per cent on pipes and 14-15 per cent on domestic adhesives. For fiscal 2027, broking house Prabhudas Lilladher estimates sales, EBITDA, PAT CAGR of 14.9, 16.3, and 19.5 per cent respectively over 2024-2027. Investment firm Anand Rathi has also projected a 15 per cent revenue growth in paints and adhesives over fiscals 2024-2027. Anand Rathi expects a strong 18, 22, and 24 per cent rise in revenue, EBITDA and PAT CAGR.
• Having established its leadership in PVC pipes, with the introduction of lead-free CPVC column pipes the company has ensured that pure stream water is available end-to-end. This also ensures that there is no possibility of lead poisoning at the water source. · Capacity expansion and new products launches will drive growth. Astral plans to commission its Ghiloth (Rajasthan) plant in November 2025 with a capacity of 4,000 mt. The Kanpur plant construc tion is on track and trials for water tanks and other products will begin very soon. The full commissioning of the plant will be within a quarter. The company also plans to launch a new PTMT pipes product range with 150 SKUs very shortly, which will contribute to the topline growth from fiscal 2026.

ADHESIVES TOO

• With a view to expanding its adhesives busi ness, the company acquired Resinova Chemie Ltd, a Kanpur-based company having a wide range of prod ucts and popular brands catering to markets across India. Astral’s acquisition of Resinova showcases its commitment to becoming a one-stop solutions provider for industrial and consumer needs in the real estate space.
• Astral’s stress on innovative prod ucts led it to launch the ‘silence’ system – one of the world’s best low-noise drainage piping systems. Going a step further, the company also launched CPVC PRO – one of the most certified CPVC piping systems in India.
• In order to diversify its product range, the company entered the sanitaryware and faucet category. At the same time, in order to have a complete portfolio of paint products and solutions, it acquired a controlling stake in Gem Paints, a Bengaluru-based paints company.
• In order to expand its operational and mar keting network pan-India, Astral set up modern plants in west ern, southern, northern and eastern India – thus covering the entire country.

U.K. BUSINESS

• Reviewing Astral's performance during fiscal 2025, research analysts at IDBI Capital maintain that the UK business sales remained flat yoy, led by destocking done by its peers. Nevertheless, the company has guided double-digit topline growth for its UK operations in fiscal 2026, led by new product launches.
• According to a technical analysis of the company during the second half of May 2025, research analysts at Master Capital Services maintain that Astral has staged a strong bullish breakout above its long-term downward sloping trend line, signalling a potential trend reversal. The stock is now trading above its 34 EMA (exponential moving average) and 55 EMA, and is beginning to turn upward - another positive sign. The MACD (moving average convergence divergemce) has given a fresh bullish crossover and the RSI (relative strength index) has entered strong territory near 63, indicating improving momentum without being overbought. This conference of signals suggests sustained upward traction. The research analysts have set a target price of Rs 1,550/1,625. Of late, the share price has slid down from the 52-week high of Rs 2,454 to Rs 1,232, before recovering modestly to Rs 1,497. Discerning investors can add this stock in their portfolio at the current price, as well as at every decline, if any.