Ducol gains Xchem control in Rs 75 crore phased acquisition

Ducol Organics and Colours Limited obtained 100% control of Xchem Polymers India Private Limited on May 1, 2026, through a Rs 75 crore phased acquisition comprising Rs 38 crore in initial cash, Rs 30 crore through a share swap and Rs 7 crore payable within 24 months. Xchem reported Rs 31.85 crore of revenue during its five-month consolidated period.

What did Ducol pay for Xchem?

Ducol agreed to acquire 100% of Xchem for Rs 75 crore under a Share Purchase Agreement, or SPA, dated March 26, 2026. The consideration comprised an initial Rs 38 crore cash payment for a majority stake, Rs 30 crore settled through a share-swap arrangement and Rs 7 crore due in cash.

The Rs 7 crore balance is payable within 24 months from the SPA’s execution date. This deferred sum remains part of the aggregate Rs 75 crore consideration, rather than an additional payment above the stated acquisition value.

The acquisition occurred in phases, with the March 26, 2026 SPA preceding the May 1, 2026 control date. Ducol’s filing does not disclose the number of shares issued for the Rs 30 crore share swap, the valuation applied to those shares, or a purchase-price allocation between Xchem’s identifiable assets and goodwill.

When did Ducol start consolidating Xchem?

Ducol began consolidating Xchem’s financial results from May 1, 2026, when it obtained 100% control. The half-year consolidated results to September 30, 2026 therefore contain Xchem’s results for five months, from May 1 to September 30, rather than for the full April-to-September period.

The filing identifies Xchem as a wholly owned subsidiary acquired with effect from May 1, 2026. Ducol also has Bitumag Industries Private Limited as a wholly owned subsidiary, with Bitumag’s financial results consolidated from April 1, 2025.

This consolidation timing limits direct year-on-year interpretation. The corresponding half year ended September 30, 2025 did not include Xchem, as the SPA was signed on March 26, 2026 and control was obtained on May 1, 2026; the change in group results therefore reflects both the five-month Xchem inclusion and movements in the existing business and Bitumag.

The independent auditor drew attention to the note stating that the acquisition was accounted for under Indian Accounting Standard 103, Business Combinations. The auditor did not modify its conclusion on that matter, while stating that it did not itself review the interim financial results of the two subsidiaries included in the September 2026 consolidated statement.

What business and earnings did Xchem contribute?

Xchem manufactures construction chemicals and industrial adhesives, and it reported Rs 31.85 crore of total revenue and Rs 2.03 crore of profit from May 1, 2026 to September 30, 2026. These are Xchem’s own reviewed results included in Ducol’s consolidated filing for the five-month period after control began.

Bitumag reported Rs 33.25 crore of total revenue and Rs 2.30 crore of profit for the half year ended September 30, 2026. Xchem’s revenue was therefore Rs 1.40 crore below Bitumag’s, despite Xchem being consolidated for five months and Bitumag for the full six-month half year.

The disclosed comparison does not establish a like-for-like margin ranking because the filing does not provide Xchem’s April 2026 results, segment costs, volumes, capacity, customer information or product-wise revenue. It does show that Xchem generated reported revenue of Rs 31.85 crore during the period in which it was consolidated.

How did Ducol’s consolidated results change?

Ducol reported consolidated revenue from operations of Rs 112.26 crore for the half year ended September 30, 2026, compared with Rs 64.52 crore in the corresponding 2025 period. Consolidated profit before tax increased to Rs 8.83 crore from Rs 3.08 crore, while profit for the period rose to Rs 6.47 crore from Rs 2.82 crore.

The filing does not assign a precise share of the year-on-year increase to Xchem, whose results were included only from May 1, 2026. Bitumag had already been consolidated from April 1, 2025, meaning the comparison includes the acquired business as well as changes in Ducol’s pre-existing operations and its other subsidiary.

Consolidated total expenses increased to Rs 104.58 crore in the September 2026 half year from Rs 62.98 crore a year earlier. Cost of materials consumed rose to Rs 84.58 crore from Rs 45.34 crore, employee-benefit expense reached Rs 8.47 crore from Rs 5.79 crore, and depreciation and amortisation increased to Rs 2.21 crore from Rs 1.55 crore.

The consolidated cash-flow statement records Rs 64.45 crore under investment in subsidiaries and goodwill in the half year to September 30, 2026, compared with Rs 23.10 crore for the year ended March 31, 2026. Consolidated total assets were Rs 254.62 crore at September 30, 2026, up from Rs 169.58 crore at March 31, 2026.

Conclusion

Ducol completed full control of Xchem through a Rs 75 crore structure combining Rs 38 crore of initial cash, a Rs 30 crore share swap and a Rs 7 crore deferred cash obligation. Xchem added a construction-chemicals and industrial-adhesives business that reported Rs 31.85 crore of revenue and Rs 2.03 crore of profit between May 1 and September 30, 2026, while group revenue rose to Rs 112.26 crore.

The next disclosed transaction milestone is payment of the Rs 7 crore balance within 24 months of the March 26, 2026 SPA. Future consolidated filings will also show whether Xchem’s contribution changes over a full reporting period, since the September 2026 results cover only five months following the May 1, 2026 control date.