Can Astral's demerger catalyze chemicals growth?

Astral's stock fell over 8% after announcing the demerger of its chemicals business (adhesives and paints) into a separately listed entity, Astral Chemie, with shareholders receiving one Astral Chemie share for every Astral share held. The chemicals business posted around Rs 1,900 crore in revenue with Ebitda margins below 10%, compared to 20% for plumbing which contributed 71% of FY26 revenue and 83% of Ebitda. Despite weak chemicals performance, management targets Rs 4,500-5,000 crore in chemicals revenue over 4-5 years at 14-15% Ebitda margins, potentially making Astral Chemie India's second-largest listed pure-play chemicals firm after Pidilite Industries, though broker views remain divided.