Aluminum Industry Shakeup: Big Merger as Major Firm Absorbs Subsidiary!
Strategic Move: Leading Aluminum Company Expands Through Subsidiary Merger!
Palco Metals Limited (PML) announced the merger of its wholly-owned subsidiary, Palco Recycle Industries Limited (PRIL), under Sections 232/233 of the Companies Act, 2013. The decision will be formalized in an Extraordinary General Meeting (EGM) on March 29, 2025, at the company's Ahmedabad office. Shareholders will vote on the Scheme of Amalgamation between PRIL (Transferor) and PML (Transferee).
Business Overview
Established in 1965, PML initially focused on auto and engineering die-cast components. Over time, it expanded into producing products for steel plants and the electrical transmission sector. Currently, PML is not involved in manufacturing but operates through PRIL, which produces aluminum wires and deoxidants.
Product Portfolio
PML offers a broad range of aluminum products, including:
- Deoxidants and Ingots: Aluminum Deoxidant, Ingots, Shots, and Notch Bars.
- Wire Products: Aluminum Wire Rods, EC Grade, and Commercial Alloys Grade Wire Rods.
- Future Products: The company plans to diversify into extrusion profiles, rolled products, slugs, tubes, alloys, die-cast components, and aluminum powder.
- Manufacturing Capabilities
PML's Ankhol, Kadi facility includes:
- Continuous Casting Lines: Two lines with a 2,500 MT capacity for wire rod production.
- Electric Resistance Furnaces: Eight furnaces with a 500 MT capacity, producing deoxidants, ingots, and other products.
- Financial Performance
- PML reported a 22% increase in revenue from the sale of goods in FY24 compared to FY23. This growth reflects the company's strong market position and effective business strategies.
Subsidiary Overview
PRIL specializes in manufacturing aluminum wire and deoxidants, with integrated facilities for wire rod production, aluminum products, and laboratory testing. The recent acquisition of PRIL's remaining 35% stake makes it a wholly-owned subsidiary of PML.
Future Plans: Forward Integration
PML aims to broaden its product portfolio through forward integration. It plans to transition from aluminum wires to a full range of conductors and cables. Phase 1 will focus on manufacturing conductors and cables, supporting the company's growth and market expansion.
Conclusion
The merger of PRIL into PML is expected to streamline operations and enhance profitability. The company's focus on forward integration and diversification into new products positions it well for future growth.
Disclaimer: The article is for informational purposes only and not investment advice.