Question

how is condensation explained by the kinetic molecular theory

Answer 1

cooling reduces particle motion resulting in coalescence by attractive forces.

Answer 2

At lower temperature particles are traveling slower, and when the collide with each other there is more time for the energy of their mutual collision to be dissipated, and for their mutual attraction to trap each other in the condensed state. The energy of interaction between parrticles generally looks like this:

The natural result when particles collide (r -> 0) at high speed is that they bounce off the inner repulsive wall (where E(r) gets very large) and fly off apart again. An exception is if something happens while the particles are close that reduces their mutual translational energy -- one of both particles slows down a lot. If that happens, then the energy can fall enough for the particles to be trapped in the U-shaped "well" in the energy of interaction. Then they're stuck to each other, unable to either come to close (because of the repulsive wall) or get too far apart (because of the attractive wall at larger r).

What could happen to remove energy? One possibility is for the energy of mutual translation to go into rotational or vibrational motion, if we're talking about things that can vibrate or rotate, like molecules. But even for atoms, which cannot rotate or vibrate, it is possible for energy to be lost to "collective" motions of a group of atoms, roughly speaking, a group of atoms can slosh about from side to side, or have wiggly wave-like motions that move through the collection. These are "collective" motions, because the energy is spread out among many atoms, not concentrated in one or two. So the energy of translation in one pair of atoms could get transferred to such a collective 'sloshing" motion, thus allowing the two atoms to remain stuck to each other.

The major determinant of whether this kind of energy transfer happens and that colliding particles remain stuck to each other is just how long the collision takes, how long they remain close enough to each other that they are within the attractive "well" in their mutual interaction. If they are that close for a very short time, as would happen in a very high-speed collision, the odds of some kind of energy transfer happening are very small. If the collision lasts longer, because they are colliding at a lower speed, then the chances are better, and if the collision happens slowly enough, losing energy and remaining stuck to each other is nearly certain.

You will no doubt hear simpler explanations that say merely that at lower speeds particles cannot escape their mutual attractive forces. You should be suspicious of this explanation (which is anyway wrong) because it ignores conservation of energy. For that process to happen would be as strange as a comet flying in from interstellar space towards the Sun, reaching the orbit of Mercury, and just stopping there, somehow shedding all the velocity that you would normally expect to take it right out into intersteller space again. The microscopic world does not obey different physics than the macroscopic. The truth of how things stick together when speeds are slower is, unfortunately (or interestingly, depending on your point of view) much more subtle than this simple (and deeply flawed) explanation. But you'll hear it a lot, even from many teachers, mores the pity.