MBA Asian paints porject

A StudyOn OrganizationStructure of AsianPaints –National Traders
HISTROY
February 1, 1942
The company has come a long way since its small beginnings in 1942. It was set up as a
partnership firm by four friends who were willing to take on the world’s biggest, most famous
paint companies operating in India at that time. Over the course of 25 years, Asian Paints became
a corporate force and India's leading paints company. Driven by its strong consumer-focus and
innovative spirit, the company has been the market leader in paints since 1967. Today, it is
double the size of any other paint company in India. Asian Paints manufactures a wide range of
paints for decorative and industrial use.
1945
The Company was incorporated as a private limited company under the name of Asian Oil and
Paint Company Pvt. Ltd. It was converted into a public limited company in 1973. The Company
manufactures a wide range of surface coatings catering to different enduses. It also manufactures
vinyl pyridine latex used in the manufacture of rubber tyres. The Company expanded its products
range, developed its own technology, set up a distribution network penetrating in smaller towns
and ploughed back a large part of earnings into creation of new facilities.
1974
The Bhandup plant in Mumbai of the Company is reportedly the largest single paint factory in
the country and one of the most up-to-date with sophisticated machinery and equipment for
manufacturing a wide range of paints and other products besides adequate resin manufacturing
capacity to meet its entire requirements.
1985
The Company undertook to set up a third paint unit at Patancheru, a notified backward area near
Hyderabad, for the manufacture of 15,000 MT of paints and enamels.
The Company entered into a collaboration agreement with Nippon Paints Co. Ltd., Japan, to
obtain technical knowhow to manufacture powder coating and coil coatings under an exclusive
license. Necessary manufacturing facilities for the powder coatings with a capacity of 300 MT
were installed and commissioned at Kasna plant during 199293.

1996
The Company proposed to set up a fifth point manufacturing plant at Ratnagiri, Maharashtra.
During 21st February, a fire broke and in the paint manufacturing block of
Mumbai plant causing extensive damage to the materials stored in the block.
A joint venture company viz. Asian PPG Industries Pvt. Ltd. was set up along
with PPG Industries, Inc. of USA to market and/or manufacture automotive paints and certain
Industrial products as may be decided upon mutually between the partners.
1998
The new initiative to install 350 color worlds received encouraging response and made
significant contribution to performance. Three new products, NC range of wood finishes, ACE
exterior emulsion and Asian wall putty were launched.
Asian Paints, the Rs.737.20 crore paints major, has launched a new marketing
thrust with the introduction of a one stop color shop for paints complete with a software for
consumers to choose and select their different shade combinations.
Asian Paints, India's No.1 Paint Company recently, launched their latest offering
‘Asian Paints Color World’. Credit Rating Information Services of India Ltd (Crisil) has
assigned an ‘AAA’ rating to the proposed nonconvertible debenture (NCD) obligation of Asian
Paints Ltd (APL). Two subsidiaries of Asian Paints Pentasia Chemicals and Pentasia Investments
have been merged with the parent company following the approval of the Board for Industrial &
Financial Reconstruction (BIFR).
Asian Paints Limited, the largest paint company in India, launched its first
exclusive showroom in Mumbai.
1999
The Company has joint venture companies in the overseas market. All these ventures are doing
well and have a strong hold in their respective markets.
In its first ever acquisition overseas, Asian Paints Ltd (APL) has acquired a 76 per
cent equity stake in Sri Lank abased Delmege Forsyth & Co (Paints) Ltd.
2000

Asian Paints has launched two variants in polyurethane (PU) wood finish under the brand name
Opal. The Company has proposed to issue bonus shares in the ratio of three shares for every five
shares held. Asian Paints has opened a manufacturing plant in oman in partnership with a local
company.
Asian Pains has acquired the entire paints business of Pacific Paints Company based in
Australia for over Rs 1 crore. Asian Paints has lifted the lockout at its factory in Uttar Pradesh.
The Company suspended operations at Kasna in July after the workers resorted to a "sitinstrike".
2001
Asian Paints has introduced Utsav Enamel for the festive season. Asian Paints has appointed
senior parnter of the solicitor firm Crawford Bailey & Co, R A Shah and Deputy Director,
National Chemical Laboratory Dr Swaminathan Sivaram as directors on the company's board.
2002
Revamps its international operations, transfers shares in its subsidiaries in Fiji, Tonga, Solomon
Island, Vanuata, Australia and the Sultanate of Oman to the Mauritius based subsidiary Asian
Paints International Executes agreement for purchase of 60% equity capital of SCIB Chemicals
S.A.E., Egypt Launches its $3 million joint venture with Bangladesh based Confidence Cements
in which the holds 51 per cent stake. Acquires controlling stake of 50.1 per cent in Berger
International, Singapore, for Rs 58 crore, appoint Jalaj Dani as CEO.
2003
Board recommends issue of bonus shares by capitalization of Reserves in the ratio of 1 equity
share for every 2 equity shares held on the record date Asian Paints, via its Singapore based
subsidiary Berger International inks a technology and brand licensing agreement with PT Abadi
Coatings Solusi, an Indonesian paint company
Shareholders approve the Scheme of Arrangement proposed to be made between Pentasia
Investment Ltd with Asian Paints India Ltd and the consequential reduction of share capital of
Asian Paints India Ltd. Berger International starts restructuring exercise to curtail cost acquires
Taubmans Paints (Fiji) Ltd. through its subsidiary in Fiji, Asian Paints (South Pacific) Ltd
(APSP) Acquisition of 9.2% shares in ICI India Ltd. Asian Paints bags Ken Sharma award

2004
10th Asian Paints Star Screen Weekly Awards aura of mystery, Asian Paints launches paint
solutions for kid’s.
2005
Berger Intl partners with Filipino firm Dutch Boy
Company has changed its name from Asian Paints (India) Ltd. to Asian Paints Ltd. 2006
Asian Paints APICL’s new manufacturing plant at Baddi commences commercial production
2009
Asian Paints Ltd has submitted the disclosure under Regulation 7(3) of SEBI (Substantial
Acquisition of Shares & Takeovers) Regulations, 1997 to BSE
Asian Paints Ltd has appointed Shri. S Ramadorai as an Additional Director of the
Company pursuant to Section 260 of the Companies Act, 1956.
2010
Berger International Ltd Singapore (BIL), a subsidiary of Asian Paints Ltd , which is a wholly
owned subsidiary of the Company. The Company's new paint plant at Rohtak in the State of
Haryana has commenced commercial production
Asian Paints Signed a MOU with Maharashtra Govt. to set up a Mega Project for manufacture of
Paints & Intermediate
2011
Asian Paints to form second Joint Venture with PPG Industries.
Asian Paints Company’s subsidiary, SCIB Chemicals SAE has temporarily restarted the
operations of its two plants in Egypt.

2012
Asian Paints Production at the Company's Plant at Rohtak, Haryana has been restarted
2013 Asian Paints completes acquisition of Sleek Group Commencement of commercial
production at new plant Asian Paints has splits its face value from Rs 10/ to 1/ 2014 Asian Paints
Ltd Enters into binding agreement with Essess India.
2013
Inspired by the success of the Stores at Mumbai and Delhi, your Company launched first ever
‘Ezycolour Store’ at Kolkata in August, 2013. This Store is a more functional version of the
‘Color Stores’ and focuses mainly on delivering a great colour consultancy experience to
customers. At the top of our retailing hierarchy, your Company increased Colour Ideas Stores to
170 by launching a record 70 new Stores during the financial year. In-store Colour Consultancy
is a key feature of these Stores which benefitted more than 80,000 customers across these Colour
Ideas Stores during 2013-14.
2014
During 2014-15, your Company took steps for setting up paint manufacturing facility and
operations as part of a greenfield foray into Indonesia. During the year, Berger International
Limited, Singapore became a wholly owned subsidiary of Asian Paints (International) Limited,
Mauritius. During the year, expansion of manufacturing capacity in Bangladesh to 24,000 KL
was completed. In Oman, project of setting up of new manufacturing facility with annual
capacity of 21,000 KL in Sohar is in the advanced stage of completion and product trials are
being taken.
2015
The expansion project at Rohtak plant in Haryana to double the capacity from the existing
2, 00,000 KL per annum to 4, 00,000 KL per annum was successfully completed this year.
During the year, a new state-of-the-art manufacturing facility was inaugurated at Sohar in Oman
with an annual capacity of 21,000 KL.

About National Traders Co – Asian Paints Distributor
National Traders Co is an established firm since 2006 in Gulbarga. And are the largest paints &
hardware distributor in North Karnataka. They have been in this business since the past 150
years we are the 5th generations continuing the same business. This outlet is new outlet at MSK
Mills Road. They distribute almost all types of paints. Currently we are dealing in Decorative
(Interior & Exterior), Industrial, NC paints & Waterproofing Products. Industrial, NC paints &
Waterproofing Products. Range of our products are Asian Paints , Sleek Modular Kitchen,
Building Hardware, Architectural Fittings, Wooden Flooring, Sanitary Ware, Tiles , Plumbing,
Modular Doors, Plywood, Laminates, Veeners Etc.
Board of Directors
Chairman Ashwin Choksi
Vice Chairman Ashwin Dani
Director
Mahendra Choksi
Dipankar Basu
Mahendra Shah
Deepak Satwalekar
Sivaram
S Rama Dorai
CFO & Company Secretary Jayesh Merchant
Managing Director & CEO K B S Anand
Additional Director
M K Sharma
Vibha Paul Rishi
Amrita Vakil
Abhay Vakil
Non-Executive Director Malav Dani

NUMBER OF MANUFACTURING UNITS AND ADDRESSES
Asian Paints along with its subsidiaries has operations in 19 countries across the world and 26
paint manufacturing facilities, servicing consumers in 65 countries through Berger International,
SCIB Paints-Egypt, Asian Paints, Apco Coatings and Taubmans. We operate in 5 regions across
the world viz. South Asia, South East Asia, South Pacific, Middle East and Caribbean region
through the five corporate brands. In 7 markets, we operate through our subsidiary, Berger
International Limited; in Egypt through SCIB Paints; in 5 markets in the South Pacific we
operate through Apco Coatings and in Fiji and Samoa we also operate through Taubmans.
Country
No.
Countries Manufacturing
Plants
Company Location
South Asia
1 India 8 Ankleshwar,
Patancheru, Kasna,
Sriperumbudur,
Rohtak, Khandala,
Sarigam & Taloja
2 SriLanka 1 Asian Paints
3 Nepal 2 Asian Paints
4 Bangladesh 1 Asian Paints

South East Asia
5 Singapore 1 Berger International
6 Indonesia 1 Berger International
South Pacific
7 Tonga Asian Paints
8 Fiji 1 Asian Paints &
Taubmans
9 Samoa Islands 1 Taubmans
10 Vanuatu Asian Paints
11 Solomon Islands Asian Paints
Middle East
12 Oman 1 Berger International
13 Bahrain 1 Berger International

14 Dubai 1 Berger International
15 Egypt 2 SCIB Paints
Caribbean
16 Jamaica 1 Berger International
17 Barbados 1 Berger International
18 Trinidad &
Tobago
1 Berger International
Africa
19 Ethiopia 3 Kadisco
Total 26

Office Addresses
Location Type Address
1 Registered office & Factory Survey No.86, plot No 1 to 4
National
Highway 8B
Rajkot Dist. – 360002
Gujarat –India
Phone : 252996,252999,666000
Fax : 252554, 666029
Email :
investorrelations@atulauto.co.in
2 Corporate office Jimmy Tower, Gondal Road, Opp
Swaminarayan gurukul,Rajkot
360002
Gujarat –India
Phone: 2374991, 2374992, 2374993.
Fax : 2374994
Email : N.A.

NUMBER OF DIFFERENT DIVISIONS AND THEIR PRODUCTS
Emulsions Division
Asian Paints manufactures two types of emulsions interior and exterior with more than 1800
color shades.
Products:
Wood Finishes Division
In the wood finishes category, the high end finishes like Polyester and Polyurethane (PU) are
manufactured by Asian Paints. It also have two categories interior and exterior. It launched full
range of clear and opaque colors across different products and exclusive special effects in wood
and glass coatings. It also collaborated with Italian company for wider range of products.

Products:
Wall Coverings Division
Asian Paints with the product name as ‘Nilaya’ have range of wallpapers has one of the largest
variety compiled in partnership with the leading manufacturers in the world and comprises of
designer handcrafted range, ‘paintable’ range, thematic collections and decals. Nilaya have a
wide range of products from many design patterns offering the customer the wide range of
options to décor their homes and offices.
Products:

Paint Application Tools Division
Asian Paints had launched a range of paint application tools in collaboration with Harris Brushes
of UK in 2012-13. In 2014-15, the tools and implements portfolio was strengthened by launch of
new products. Sustained field marketing effort has resulted in the wide acceptance and good
growth in this segment. It have Rollers, Brushes and Accelerators in product varieties in this
category.
Products:

Kitchen and Bath Division
The kitchen and bath businesses have been co-branded with Asian Paints and ‘Sleek’ and another
company ‘Essess’. The “Sleek by Asian Paints” and “Ess Ess by Asian Paints” approach has
been received very positively by the existing network and consumers, as this brings the expertise
of the individual businesses together with the credibility and trust of the “asianpaints” brand.
Products:
Adhesive Division
Asian Paints have a product in this category offering customer a wide variety of adhesives based
on the material like wood, glass, stone, rubber and for general purpose.

Products:

NUMBER OF EMPLOYEES AND THEIR CADRE
Asian Paints have around total 10,000 plus employees worldwide, they operate as a team with
below cadre:
Managing Director 01
General Manager 01
Financial Manager 01
Sales Manager 01
Service Manager 01
Work Manager 01
Sales Men 03
Accountant 01
Cashier 01
supervisor 01
Mechanic 05
Employees 03

RECRUITMENT AND SELECTION PROCESS
Asian Paints promise an environment that provides a richness and variety of experience. We want
our employees to work in a space that allows learning, exploration, and contribution, and
endeavour to engage them through challenging work and meaningful conversation.
The opportunity to interact with multiple functions and disciplines will bring about functional
expertise and insights into inter-disciplinary collaborations. They reward merit, encourage
openness, and respect individual opinion.
Manpower procurement or recruitment may be defined as 'A Strategy for the acquisition,
Utilization, improvement and preservation of the human resources of an enterprise'. It is the
activity of the management, which is, aimed at coordinating the requirement for the availability
of different types of employees. This involves ensuring that the firm has enough of the right kind
of people at the right time and also adjusting the requirements to the available supply.
Recruitment is understood as the process of searching for and obtaining applicants for the
jobs, from among whom the right people can be selected.
Recruitment forms the first a stage in the process, which continues with selection and ceases with
the placement of the candidate. It is the next step in the procurement function, the first being the
manpower planning.
Recruitment makes it possible to acquire to ensure the continued operation of the organization.
Recruiting is the discovering of potential applicants for actual or anticipated organizational
vacancies. In other words, it is a 'linking activity' bringing together those with jobs and those
seeking jobs.
Recruitment has been regarded as the most important function of personal administration,
because unless the right types of people are hired even the best plans organizational carts and
control systems would not do much good. Thus, recruitment forms a means for attracting
manpower in adequate number to permit effective selection of a capable of productive work

force. It is a continuing function involving efforts to attract employees equipped with job
potential employees for jobs in an organization.
 To prepare the employee, both new and old to meet the present as well as the changing
requirements of the job and the organization
 To prevent obsolescence.
 To impart the new entrants the basic knowledge and skill they need for an intelligent
performance of a definite job.
 To prepare employees for higher level tasks.
 To assist employees to function more effectively in their present positions by exposing
them to the latest concepts, information and techniques and developing the skills they
will need in their particular fields.
SOURCES OF RECRUITMENT
Before an organization activity begins recruitment applicants, it should consider the most
likely source of the type of employee. It needs some companies try to develop new sources,
while most only try to tackle the existing sources they have.
These sources accordingly may be termed as internal and external.
INERNAL SOURCES
These include personal already on the pay roll of and organization, i.e. its present
working force. Whenever any vacancy occurs, somebody from within the organization is
upgraded, transferred, promoted or sometimes demoted. This source also includes personal who
were once on pay role of the company but who plan to return of whom the company would like
to receive, such as those on leave of absence, those who quit voluntarily or those on production
layoff or even those who are trainees in the organization.
This source is used by many organizations, but a surprising number ignore this source,
especially for middle management jobs.
EXTERNAL SOURCES

These sources lie outside the organization. They are
1. New entrants to the labor force, i.e. mostly young experience, potential employees and
college students.
2. Unemployed with a range of skills and abilities.
3. Retired experienced persons.
4. Others not in labors force, such as married women, persons, from minority groups.
5. Private employment agencies or consultants.
6. Professional associations.
7. Education and training institutions.
METHODS OF RECRUITMENT
There are basically three methods of recruitment. Direct, indirect and third party
Method.
Direct Method:
This includes sending traveling recruiters to educational and professional institutions,
employee's contacts with public and manned exhibits other direct methods include sending
recruiters to conventions and seminars, settings up exhibits at fairs, and using mobile office to
go to the desired centers.
Indirect Method:
It mostly involves advertising in newspapers, on the radio, in trade and professional
journals, technical magazine broaches. Some organizations often place what is referred to as a
blind advertisement. One in which there is no identification of the organization, respondents are
asked to reply to a 'post office box number'.
Third Party Method
These include the use of private employment agencies employee referrals, voluntary
organizations, state agencies, placement offices of schools, colleges and professional

associations, recruiting firms, management consulting firms, indoctrination seminars for college
professors, friends relatives, computer data banks etc.
SELECTION
Selection is the process of ascertaining the qualification experience, skill, knowledge etc.
of an applicant with a view to appraise his/her suitability to a job.
Selection Procedure:
Although an effective recruitment program can provide us numerous job applications,
there still remains a crucial problem of selection of the most suitable human resources with a
view to placing them in vacant positions in the enterprise.
Selection standards and personal qualities of a candidate determine whether or not he is
placed on a job. An effective selection program is a nonrandom process because those selected
have been chosen on the basis of the assumption that they are more likely to be better employees
than those who have been rejected. Then the next problem is the next problem is the assignment
of jobs to the newly selected individuals.

ESSENTIALS OF SELECTION PROCEDURE
The selection procedure adopted by an organization is mostly tailor made to meet its
particular needs; the thoroughness of the procedure depends upon three factors.
First: the nature of selection, weather tautly of safe because a faulty selection affects not only
the training period that may be needed, but also results in heavy expenditure on the new
employee and the loss that may be incurred by the organization in case the job occupant fails on
his job.
Second: The policy of the company and the attitude of the management. As a practice some
companies usually hire more than the actual number needed with a view to removing the unfit
persons from the jobs.
Third: The length of the probationary or the trial period. The longer the period, the greater the
uncertainty in the minds of the selected candidates about his future.
To prepare the employee, both new and old to meet the present as well as the changing
requirements of the job and the organization.
Selection through Job portals and Asian Paints Career Portal
The company updates for vacant openings in the Job portals such as www.naukri.com and
www.monster.com and also in their website under career section
https://www.asianpaints.com/more/careers.html based on the skillsets of the candidate they get
shortlisted if they find suitable for the job description. Then the process goes through following:
1. Written Test: Online test on subject matters
2. Group Discussions: 20 minutes group discussion on business case study
3. Face to Face Panel interview: 3-4 panellists will judge for soft skills mainly for
communication skills / behaviour /composure /leadership skills/initiative
/aggression /team spirit /creativeness.

Selection through Campus
Asian Paints also visits various colleges across country to recruit the fresher employees, they
also have summer internships. Summer internship program has been a long-standing tradition
and an important way for them to select their next generation of achievers. Interns find
themselves learning under esteemed seniors – many of whom are B-School alumni themselves.
They conduct frequent reviews to track progress.
ORGANIZATION STRUCTURE

COMPANY TURNOVER/ SALES / PROFIT
Overview of Company’s financial performance for FY 2014-2015
Net revenue from operations on standalone basis increased to Rs. 11,648.83 crores as against Rs.
10,418.78 crores in the previous year – a growth of 11.8%. The performance for the current year
is after considering results of bath business acquired in June, 2014.
Cost of goods sold as a percentage to net revenue from operations decreased to 55.3% as against
57.0% in the previous year. The decrease is on account of reduction in key raw material prices,
specifically in the second half of the year, on the back of significant drop in crude prices.
Employee cost as a percentage to net revenue from operations increased to 5.2% (Rs. 606.94
crores) as against 4.6% (Rs. 482.43 crores) in the previous year. The increase is mainly on
account of falling bond yields during the year which adversely impacted the provision for
retirement benefits.

Other expenses as a percentage to net revenue from operations increased to 22.2% (Rs. 2,591.52
crores) as against 21.3% (Rs. 2,219.13 crores) in the previous year. The Company was carrying a
provision of Rs. 14.04 crores in respect of the diminution in carrying value of its investment in
Asian Paints (International) Limited (APIL), Mauritius in the earlier years. Based on the
assessment of the fair value of the investment in APIL as at 31st March, 2015, the aforesaid
provision for diminution has been reversed in the current year. The same is included in
"Exceptional items" in the Statement of Profit and Loss. The details of "Exceptional items" are
given in Note 51 to the Standalone Financial Statements and Note 28 to the Consolidated
Financial Statements.
The Profit After Tax for the current year is Rs. 1,327.40 crores as against Rs. 1,169.06 crores in
the previous year - a growth of 13.5%. The growth in profit is mainly driven by softening of
input prices during the second half of the year.
On a consolidated basis, your Company achieved net revenue of Rs.14,182.81 crores as against
Rs. 12,714.81 crores - a growth of 11.5%. Net profit after minority interest for the group for the
current year is Rs. 1,395.15 crores as against Rs. 1,218.81 crores in the previous year – a growth
of 14.5%.

Consolidated financial statement for previous ten years:

PRODUCT LINE LENGTH / WIDTH / DEPTH
These terms all relate to a business that sells products, and describes the organization of those
products for marketing purposes.

1. LINE: The term "product line" includes all the different things the company is selling in a
particular category. Put them all together and you have the "line." It might be a long line, or a
short one.
2. WIDTH: How many different "lines" the company produces. Some companies may sell many
different "categories" of items. Some may not.
3. LENGTH: This refers to products that are sold that are similar to each-other, but not bundled
together and sold as one. For example, car wash, car polish, car air fresheners that are sold
individually and not as a package. They would be part of the same line. A long line means
many different, related products to sell.
4. DEPTH: Think of this like subcategories. If a company sells face soap, it may have 5 different
formulas depending on skin type.
5. BUNDLING: Though you didn't ask, this a piece of the puzzle, too. This is putting related
products together and selling them as one thing. They don't count as individual products, but one
bundled entity.
Diagrammatic representation of Asian paints – Product line Length/ Width/ Depth:

MARKET SHARE AND COMPETITIORS
The national branded players such as Berger Paints, Kansai Nerolac and Akzo Nobel have
stepped up efforts in the decorative segment, especially the premium end, to shore up earnings.
Asian Paints has had a clear head start over its peers.
The company's strong brand equity, robust distribution network of over 30,000 dealers (double
of that of Berger's 15,000) and operational efficiencies are the key differentiators that protect its
position.
With a market share of more than 40 per cent, Asian Paints remains the undisputed leader. While
market share gains appear to be difficult from here on, analysts believe, the company will not
face difficulty in maintaining its position.
The gap between Asian Paints and the next competitor, Berger Paints (with an estimated market
share of 17 per cent), is large enough to not be bridged anytime soon.
Asian Paints has been marketing its premium-end decorative paints, such as Royale Play and
stenciled wall-painting, for a few years now, ahead of competition.

SWOT Analysis
Strengths
1. The largest paint company in India and third largest company in Asia
2. They have over 50% of market share and are clear leaders decorative
paints and are strong competitors to Kansai Nerolac Paints to be leaders in
Industrial paints and coatings.
3. They operate in 17 countries and have 24 manufacturing facilities
providing service to 65 countries all over the world.
4. Asian paints has strong international presence with its four 4
subsidiaries; Berger International Limited, Apco Coatings, SCIB Paints
and Taubmans.
5. Most renowned brand in Indian Paint Industry & its strong customer
focus and innovative-spirit has made it market leader since 1968.
6. Superior technologies deployed to achieve maintain the competitive
edge for eg. Supply chain management system that integrates plants,
regional distribution centers, outside processing centers etc. hence they

have strongest supply chain system with
7. They have maintained their brand name and increased awareness by
unique ways of advertising and roping in celebrities like Saif Ali Khan.
8. The company has strong financials.
Weaknesses
1. Limited market share in industrial paints segment with Kansai Nerolac
and Akzonobel giving stiff competition.
2.In decorative paints Industry Customer tastes and perceptions change
very fast and products may become obsolete with change in trends, hence
production planning and inventory problem.
Opportunities
1. Big an international standard paint company it should look for more
opportunities abroad
2. There is a good scope for growth especially in industrial paints
category
3. Needs to have more focus on Automobile industry in industrial paints
segment
4. Competitors are going for Hi-tech process and Asian paints with good
financial and intellectual capital can go for hi-tech.
Threats
1. Growth prone to slowdown effects
2.Stringent Government rules and regulations regarding the quality of
products and manufacturing facilities as Environment policies are given
more emphasis
3.Raw material scarcity and volatility in prices.
Competition
Competitors
1. Jenson & Nicolson India Limited.
2. Kansai Nerolac Paints
3. Akzonobel
4. Sherwin-Williams
5. Nippon Paint
6. PPG Industries
7. Berger Paints

MARKETING / SALES PROCEDURE / STRATEGY
Marketing:
Product in the Marketing mix of Asian paints
Asian Paints manufactures as well as markets decorative and industrial coatings and it provides
solutions and services for home paintings. All the products of Asian Paints are of acrylic type
with properties such as washable, long-lasting, leak proof and sunlight protected. Some of the
main products of the company are as follows
 Industrial coatings include Road markings, floor coatings and protective coatings.
 Decorative paints include metal surface paints, wood surface paints, exterior wall paints and
interior wall paints.
 Ancillaries include wood primer, exterior wall putty, wall primer and acrylic wall putty.
 Asian paints Royale – An interesting offering by Asian paints where they decorate your house
with colors and Asian paints direct painters are involved in the process.
Along with the above paints, Asian Paints has been in the market of automotive paints. It is a
joint venture with another company called PPG industries under the name PPG Asian Paints. The
products include the manufacturing of plastic coatings and body coatings.
Place in the Marketing mix of Asian paints
Asian Paints has spread its operations across the globe in at least seventeen countries. In every
country, it has set up manufacturing facilities and in eleven out of the seventeen, it has become
the number one paint manufacturer.
Place in the Marketing mix of Asian paints
Asian Paints has spread its operations across the globe in at least seventeen countries. In every
country, it has set up manufacturing facilities and in eleven out of the seventeen, it has become
the number one paint manufacturer.
The operations of Asian Paints are held through a network of five regions worldwide via,
Caribbean region, Middle East region, South Pacific region, South-East Asia and South Asia. A
massive research and development center has been opened in India.
The company has a manpower that is dedicated and well-organized and it enables the company
to harness all the available information and technology solutions in order to increase the

operations efficiently. Asian Paints has sidestepped the segment of bulk buyer and has gone
directly to the individual customer.
At first, it concentrated on the semi-urban and rural areas and later on the urban areas. After
entering the retail market, it initiated an open-door policy for the dealers and started a nationwide
marketing and distribution. It has 6 manufacturing locations and 70 sales branches, 15,000
dealers and numerous warehouses. This intricate network along with sales managers, the
executives and the sales team handle all steps of manufacturing and distribution.
Price in the Marketing mix of Asian paints
In order to implement a balanced pricing policy Asian Paints has been keeping a close watch on
the markets. The pricing decisions lean heavily on raw materials, petro-products, taxes, excise
duty and various other factors. Even the increase or decrease in the competitor’s prices affects a
brand heavily. That is why constant watch and periodical evaluation of its pricing strategy has
become necessary for a high-profile company like Asian Paints.
Asian Paints has kept a very flexible pricing policy. It has created various sub brands for the
various sections of the society. The price range is kept according to the properties of every brand.
All the products are of very fine quality with some ad-on features with them. The strategy has
been kept of value based pricing policy with prices going up and down as per market situation.
Promotions in the Marketing mix of Asian paints
The mascot for Asian Paints is Gattu and the cartoonist R.K Laxman created it in the year 1954.
Gattu, who had an endearing appearance with his hair locks dangling over his right eye, became
a very popular figure. After reigning for more than four decades, it was phased out in a
rebranding initiative in the year 2002.
Even the logo was changed to display an upmarket and contemporary look that denoted
technology and sophistication. All the promotional activities of Asian Paints are based on the
fact that the company is all about the family and its members along with their homes, which are a
reflection of each other.
The slogan “Har Ghar Kuch Kehta Hai” is a prime example of the fact that the brand is trying to
connect with the emotions of the people. The famous actor pair of brother and sister Saif Ali
Khan and Soha Ali Khan have been endorsing its brand Royale. Actor Akshay Khanna has also
been a part of the promotional activities. Currently Deepika Padukone has taken over the brand
endorsement. The promotions also include incentives to the painters, distribution of t-shirts and
caps and added privileges to its members.

Finally, the best brand element for the brand is its wide distribution network, the quality of its
products and its repeated marketing communications which keep reminding the end customer
that Asian paints is the best paints brand out there.
Sales Procedure:
Asian adopted the new digital transformation to achieve the best sales procedure by investing in
the implementation of best ERP system.
The company started an initiative in 2000s to reduce debt and improve their internal efficiencies.
They decided to implement an enterprise-wide ERP and Advanced Supply Chain Management
System. This further helped them in creating an enterprise-wide platform that was the basis for
further improvements in sales and customer processes. This initiative also liberated working
capital that helped fund acquisitions in emerging markets. The organization also linked sub-
contractors and suppliers on a B2B portal that helped to further improve their efficiencies.
Finally, in 2013, the firm invested in a CRM system.
Real Transformation
There was another transformation initiated by the firm in 2010. They now centralized their order
taking process into a single corporate call centre. This change helped them to improve their
operational efficiencies while sustaining their growth. In customer-facing processes, this move
also encouraged retailers to place their orders through the call centre where they would now
receive a more consistent service level than they could through the firm’s 100 local depots.
Moreover, the centralized data process also facilitated delivery of products to large institutional
customer job sites, giving their customers a capability, which their competitors couldn’t provide.

Result of this transformation
One of the biggest changes that was noticed after centralising order taking process was the way
in which the sales people interacted with the retailers. The sales team was now liberated from
those annoying order collection processes and focussed more on building stronger relationships.
Furthermore, in order to ensure a more meaningful interaction between the sales team and the
retailer, the company provided the sales people with vital customer data in the field using mobile
devices. A rollout of tablet devices, which is currently underway, will further mobile-enable the
sales staff.
Digital transformation extended to internal production processes
Asian paint witnesses a high growth in paint demand, which further creates a need for new
manufacturing plants in every three years. Looking at the scale and size of these plants, the firm
has now begun to focus on creating highly automated plants.
This automation has helped the organization to achieve greater scalability, quality and stronger
safety and environmental protections. These new plants are fully integrated from an information
management perspective. Data from shop floor systems and automated warehouses are linked
seamlessly to the ERP which has helped the firm to sustain the firm’s operational efficiencies.
New Service Strategy
In India, the company has now started to sell services instead of products. They now offer
service of painted wall rather than selling a can of paint. This service strategy has benefitted
beyond new revenues.
Selling services helps the organization to ensure that their high end products are applied
properly, which further helps in improving customer satisfaction. Moreover, selling services also

helps the firm to get closer to the end-customer, understand core customer choices and also
launch high-end texture finishes.
Another advantage of having a contractor in a client’s house helps to yield information for the
marketing staff as they can understand the customer preferences as well as potential demands.
Gaining better knowledge of end-customer preferences is a high priority for the company, since
its business model – operating largely through retailers – means that customer involvement has
been traditionally very low.
Corporate growth as well as new technology demands has increased the challenges of digital
governance.
Asian Paints is in the first year of a new portfolio planning process. Mr. Manish Choksi, CIO &
Chief Strategy shared, “we have enjoyed great equality with the business because we have
delivered solutions. But seeing so many projects coming at us, we felt that now we need to
establish processes to match expectations and resources whilst taking on innovative projects.
The company’s investment in strong IT capabilities, combined with organizational and process
changes intended to leverage those investments. This will serve as a foundation upon which the
organization can continuously envision and implement new forms of digital transformation.
Marketing Strategy:
"Asian Paints aims to become one of the top five Decorative coatings companies world-wide by
leveraging its expertise in the higher growth emerging markets. Simultaneously, the company
intends to build long term value in the Industrial coatings business through alliances with
established global partners."
With Economic performance as objective the organization now has to develop short-term goals
to reach the overall objective. These Goals are usually functional target such as production,
Sales, new market develop, new product development and technology up gradation, once the

goal are determined the strategies can be evolved to meet the goals. The organization is now on
the way to achieve the overall objective of Economic
(i) Customer Asset: The settings up Asian paints colour world, a chain of state art paint shop, is a
major step towards building customer asset. At the same time company is focusing more in rural
areas than urban area and continuing to provide good and quality service to the customer.
(ii) Technology asset: Asian paint is one of first Indian company to go hi-tech. Asian paint has
always kept its competitor at bay by constantly re-innovating its business process and system.
(iii) Employee Asset: Asian paint always praise its employee for its success in the market.
Company always considers employee as a biggest factor of its success.
(iv) Dealer vendor relationship: Asian paint always maintain a close relationship with its dealers
because company think that they play a major role in Asian paint recent success.
(v) Brand Asset: Although it is operating in the commodity market but still Asian paint is
investing heavily in branding. Gattu- Asian paint official mascot is very popular in India.
Divisional objective:
Asian paint has followingdivision that are as follows:
Decorative segment
Asian paint is the leader in this segment. It is ahead that its competitor Nerolac and Berger in
Decorative segment company still have certain objective for this sector that to increase it sales
and to acquire maximum position in the market share in Indian paint market.
Objective for decorative segment :
To expanding its range in the economy segment.
To strengthen its position in the emulsion segment in both exterior and interior emulsion.
To continue its strategy of pricing aggression and increase it sales and to gain the market share
along with a good operating margin.
To focus on the rural market as company believes as it as been its objective since the beginning.
To focus more on ad campaign for enhancement of their sales in urban as well as rural market.

Industrial segment
Asian paint second line of production deals with the industrial coating. The constraint in these
segment is that it is not as successful as the decorative segment. In these sector it has to face a
stiff competition from its nearest competitor Nerolac and Berger Paints.
Objective for Industrial segment:
To build new infrastructure in the country for Industrial coating to increase the production
capacity.
To develop the quality of the product with a higher technological up gradation.
To increase the sales of the Industrial coating with the help of proper Ad. campaign programme.
Automotive segment:
Automotive is the third segment of the Asian paint. It is a product which company target for the
automobile market in India as well as abroad.
Objective of automotive segment :
To put emphasis on continuous improvement in quality and productivity.
To put emphasis on detect prevention
To reduce variation and wastage in the supply chain
Marketing Objective:
Asian paints the leader in Indian paint Industry has a very strong marketing division. With more
than 35% market share Asian paint is still growing in leaps and bounce to achieve higher targets.
It is changing fundamentally with two objective in mind a huge ramp in the market share and
better growth over the next three years. Previously company used to function as undifferentiated
organization. But now they have divided it into three section each. And each section has its own
independent support system, targets and performance parameter.

Company marketing objectivesare as follows:
Asian paint is highly accepted in the urban sector and now the company is trying to access the
rural market with low price product like Utsav targeting every customer of all income level.
To increase its sales in the urban sector Asian paints today have 30 colour world located in
different cities of India where any body can have the real taste of the colour.
Online marketing has become an integrated part of the company and company is trying install a
strong integrated for online marketing.
Asian paints international unit, which have a dedicated marketing team is also targeting for a
rapid growth in overseal market.
Asian paint is following unlque strategy of marketing in the rural areas by using their official
mascot. According to the company it feels that picture are more dominant than name.
Asian paint website Asian paints com provides several information regarding the product and
various other information that is being required by customer.
Volumes and Profits:
Indian paint industry is less than Â½ of the size of the Chinese paint industry by volume and less
than 1/5 of the size of the US paint Industry by volume.
In terms of Per capita consumption, the Indian paint industry lags behind the Pakistan and Sri
Lankan markets also.
Product:
Paint
Asian paint details with product that is
(i) Decorative (ii) Industrial (iii)Automative.
The product that this project will deal with will exclusively be decorative pains.
Decorative Paints includes the following categories of product
EXTERIOR WALLS:
Asian Paints offers a range of emulsion paints for your exterior walls such as ACE, Apex, Apex
Ultima, Apex Duracast and more, based on the specific demand of surface area.

INTERIOR WALLS:
Distempers
Distempers offer strong performance to the interior wall surface in terms of protection and
adhesion. Tractor Acrylic Distemper, with better durability, is one of the best performing
distemper made by Asian Paints.
Emulsions
Interior emulsions are advanced water based paints with better quality and shade range.
Adhesion to wall surface, anti-fungal properties and durability is more in emulsions.
Enamels
Enamels is a premium brand from Asian Paints, it is superior in terms of performance and gives
that Perfect Finish for the walls.
Market Size:
The market size of the Indian paints sector has been pegged at Rs 170 bn in value terms and is
very fragmented. The per capita consumption of paints in India stands at 0.5 kg per annum as
compared to 1.6 kgs in China and 22 kgs in the developed economies. India's share in the world
paint market is just 0.6%.
The unorganised sector controls around 35% of the paint market, with the organised sector
accounting for the balance. In the unorganised segment, there are about 2,000 units having small
and medium sized paints manufacturing plants. Top organised players include Asian Paints (30%
market share), Kansai Nerolac (20% market share), Berger Paints (19% market share) and ICI
(12% market share).
Decoratives: Major segments in decoratives include exterior wall paints, interior wall paints,
wood finishes and enamel and ancillary products such as primers, putties etc. Decorative paints
account for over 75% of the overall paint market in India. Asian Paints is the market leader in
this segment. Demand for decorative paints arises from household painting, architectural and
other display purposes. Demand in the festive season (September-December) is significant, as
compared to other periods. This segment is price sensitive and is a higher margin business as
compared to industrial segment.

Industrial: Three main segments of the industrial sector include automotive coatings, powder
coatings and protective coatings. Kansai Nerolac is the market leader in this segment. User
industries for industrial paints include automobiles engineering and consumer durables. The
industrial paints segment is far more technology intensive than the decorative segment.
Customer Retention
Asian Paints Limited, India's largest paint company, has a reputation for professionalism and
fast-track growth.
Customers are at the core of all Asian Paints business activities. A simple but unbeatable concept
of "going where the customer is" drives all its major initiatives.
The company has an enviable reputation in the corporate world for professionalism, fast-track
growth and customer-centricity.
The Key Challenges addressed by the company are:
A Fresh Approach to the Customer Experience
Develop a direct link to the customer
Standardize sales delivery processes used by Asian Paints
Institute an online ordering and accounting system for providers
Implement a real-time reporting system for employees and business partner
IntermediaryRetention
Industry is characterized by the presence of intermediaries who have a very high influencing
power on the purchase decisions of the consumer, especially in the urban areas.
Using these intermediaries for initiating demand: The intermediaries (the painters, contractors,
designers, decorators etc.) are used as a marketing arm of the company Occupy part of the
intermediary space and try to sideline other intermediaries: Asian Paints has opened a service
arm, which provides the services provided by the existing intermediaries in the market. Being
present in different seditions of the value delivery system and having a strong brand equity in the
Paints market would give AP the credibility to operate a strong service arm. The service based
strategy of AP could have two different approaches

AP could try to reduce the power of the intermediary by increasing the Pull for the product. The
role of the influencer could be drastically reduced by increasing the power of the end-consumer.
AP can achieve this by establishing a strong brand name for its brands.
Marketing strategy: Key to success
The decorative paints segment displays some of the classic attributes of FMCG products.
Since the user-base has no geographical boundaries, a company's ability to penetrate new
markets and improve product awareness would be the key to maintaining market share. The
future prospects, thus, depend on the marketing and distribution strategy plays a crucial role in
future prospects.
Distribution is where Asian Paints is strongly placed. Its dealer network of 14,500 is the largest.
It is closely followed by Goodlass Nerolac with 11,000 dealers. Berger Paints and ICI (India) are
way behind in terms of market reach. Another major marketing strategy is offering value-added
services to consumers. For instance, colour vending machines have been used with great success.
Companies that have the ability to provide more choice to the consumers, without significantly
impacting the expense budget, are likely to attract more customers.
The product reach also depends on the level and depth of the companies' promotional activity.
For the paints industry, however, what matters more is the brand rather than the product.
Therefore, the level of ad-spend by the companies should give an idea of the brand-building
effort. For instance, Asian Paints registered the highest increase in ad spending (31 per cent
growth) in the year ended March 2000 compared to March 1999. Berger Paints recorded a 22 per
cent growth. Goodlass growth declined by around 2 per cent, while that of ICI India slipped 30
per cent. But whether the ad-spend has helped the company in 2000 is a moot point.
The sales generated for every rupee of expenditure should give us an indication of the
effectiveness of the ad-spend. For every Rs 1 crore spent on advertising, Goodlass Nerolac
managed to generate sales volumes of Rs 54 crore, Rs 8 crore more that it managed in 1999.
Surprisingly, both Asian Paints and Berger Paints recorded a reduction in sales generated as a
ratio of spending on advertisement. Asian Paints managed to generate Rs 38 crore in 2000

compared to Rs 42 crore in 1999. Similarly, Berger Paints generated Rs 48.50 crore in 2000
against Rs 50 crore in 1999.
VITAL INFORMATION SPECIFIC TO PAINT INDUSTRY
The major change that has taken place in the coatings industry during the last 40 years has been
the adoption of new coating technologies. Until the early 1970s, most of the coatings were
conventional low-solids, solvent-based formulations; waterborne (latex) paints, used in
architectural applications, accounted for 30–35% of the total. In the late 1970s, however,
impending government regulations on air pollution control focusing on industrial coating
operations stimulated the development of low-solvent and solventless coatings that could reduce
the emission of volatile organic compounds (VOCs). Energy conservation and rising solvent
costs were also contributing factors. These new coating technologies include waterborne

(thermosetting emulsion, colloidal dispersion, water-soluble) coatings, high-solids coatings, two-
component systems, powder coatings, and radiation-curable coatings.
Coatings provide two primary functions—decoration and protection—that are of considerable
economic importance. About 45% of the coatings produced worldwide are used to decorate and
protect new construction as well as to maintain existing structures, including residential homes
and apartments, public buildings, and plants and factories (referred to as architectural or
decorative coatings or simply, "paints"). Another 40% of the coatings are used to decorate and/or
protect industrial products (called "product finishes"). Without coatings, product lives might be
shortened drastically and many products would not even be marketable. Most of the remaining
coatings, called "special purpose," are used for miscellaneous applications such as traffic paints,
vehicle refinishing, high-performance coatings for industrial plants and equipment, and
protection of marine structures and vessels. These are usually applied outdoors in ambient
conditions.
The following pie chart shows world production of paints and coatings:
The paints and coatings industry in the United States, Western Europe, and Japan is mature and
generally correlates with the health of the economy, especially housing, construction, and
transportation. Overall demand from 2014 to 2019 will increase at average annual rates of 3% in
the United States and 1.5–2.5% in Western Europe. In Japan, however, consumption of paints
and coatings will experience relatively slow growth during this period (0.5%), as a result of no
growth in major markets such as automotive OEM, machinery, and appliances.
In the emergent countries of the world, coatings are growing at a much faster rate. The best
prospects for growth are in Asia Pacific (4–5% growth per year in the near future), Eastern

Europe (6%), and Latin America (8%). Total global growth should be about 6% per year.
Growth of coatings is expected to continue at 8% per year in China, 11% in India and 4–5% in
Indonesia. Growth in value terms will be even higher because of the increased production of
relatively higher-valued coatings. Most of the major multinational paint producers, including
PPG, Akzo Nobel, Kansai Paint, Nippon Paint, BASF, Axalta (formerly DuPont), Chugoku
Marine Paint, Valspar, Sherwin-Williams, and Hempel, have production in China. The
multinational producers should gain even more presence in the developing world as living
standards increase and per capita consumption of coatings rises.
One new area of interest is nanotechnology, with tens of thousands of patents issued already just
for the coatings industry. Very small ceramic or metallic particles can be added to paint
formulations to modify specific properties (e.g., scratch, mar, wear, corrosion, and UV
resistance) in highly specialized applications. The average size of nano particles is 10–70
nanometers, consisting of less than 6.5 million atoms. At these sizes, the ratio of surface area to
mass becomes significant, giving the particles unique properties. For example, at 2 nanometers,
the conductivity of metal particles changes and at 20 nanometers, the transparency of ceramic
particles changes. At 20 nanometers, particles of gold turn red and their plasticity disappears.
Some of the futuristic applications are nanotubes for electrically conductive coatings and to
increase the speed of reaction of thermosetting resins; organosilane dendrimer coatings;
buckyball coatings for machine parts; and metals for conductive coatings in inks. The technology
is mainly limited to highly specialized applications because of the high cost per unit volume
needed to reduce the size of particles and the need to add surface modifiers to keep the particles
from agglomerating. Recent research efforts have been focused primarily on functionalizing the
particle surface of the nano particles to make them more compatible with the coating resin
systems, so that easy dispersion, low viscosity, and covalent bonding between the particles and
resins are achieved.
Through the next five years, air pollution regulations will continue to be a driving force behind
the adoption of new coating technologies. Despite the relatively slow growth in demand
anticipated for coatings overall, waterborne and high-solids coatings, powders, UV curables, and
two-component systems appear to have good growth prospects.

In general, environmental regulations are becoming more stringent in all regions to limit
emissions of volatile organic compounds (VOCs) and hazardous air pollutants (HAPs), not only
in the industrialized world, but also in developing countries like China.
INDIAN COATINGS INDUSTRY – ARCHITECTURAL
MARKET: Architectural coatings constitute 70% by value and 77% by volumes •
TECHNOLOGY: There has been a recent shift towards water-based coatings in the recent past,
and the current split between water-based systems and solvent-based systems stands at about
50:50 today, with water-based systems easily outgrowing solventbased systems. Designer
finishes are fast gaining popularity and prominence. • SALES: The mode of sale for architectural
coatings is predominantly distributor-driven or through hardware stores. Institutional sales are a
small fraction driven by the organized construction segment. The DIY segment is non-existent.
Point-of-sale tinting is becoming increasingly popular, though. Over 22,000 installations, making
it the most in the world.
PRODUCT:
INDIAN COATINGS INDUSTRY – ARCHITECTURAL
PLAYERS: Organized sector contributes 58%. The top players are Asian Paints, Berger Paints,
Kansai Nerolac Paints, Akzo Nobel (ICI Paints) and Shalimar Paints • APPLICATION: Still rely
on unskilled applicators with low sophistication in application equipment. Growing usage of
spray guns is a recent trend. • GROWTH-DRIVERS: – 100% FDI in construction – Change in

culture tending towards nuclear families – Simultaneous upgradation of major cities, satellite
towns and rural areas – Easy availability of home loans at affordable rates – Thrust on non-
residential sector as well – Government-driven housing schemes
The Rs 40,600-crore Indian paint industry is likely to see a 20 per cent compounded annual
growth rate until 2016, says a study by business chamber Assocham.
This is due to increasing demand from retail consumers, on rapid urbanisation, and development
of rural markets. The industry will reach the level of Rs 62,000 crore in the next two years, it
said. A rise in disposable income of the average middle class coupled with increasing investment
on education, urbanisation, development of the rural market and various launches of many
innovative products will be major drivers, it said. India is the second largest consumer of paint in
Asia.
“The Indian paint industry has seen a gradual shift in the preferences of people from the
traditional whitewash to higher quality paints like emulsions and enamel paints,” said D S
Rawat, secretary-general, Assocham.
The rural market grew 20 per cent in 2013-14. Rural India’s incremental consumption
expenditure is growing well. And, the rural sector has a major share of thedecorative paints
segment. Thus, any benefit to the rural sector’s disposable income is directly correlated to the
paint industry’s growth.
Besides, decorative paints are marketing well, backed by large advertisement campaigns and
dealership networks. In FY14, per capita consumption of paint increased to a little over four kg,
of which the decorative segment contributed 73 per cent at Rs 29,638 crore. The remaining Rs
10,962 crore was contributed by the industrial segment.
“Demands for decorative paints arise from household paintings, architectural and other display
products. The demand for paint increases during festive seasons as compared to other periods,”
said Rawat.
The decorative paint market has been further segmented into emulsions, enamel, distemper and

cement paints. Industrial paints are segmented into automotive coating, high performance
coating, powder coating and coil coating.
The unorganised sector has around 35 per cent of the paint market. In the unorganised segment,
there are about 2,500 units.
Primary Reasons for the Growth of Decorative Paint Industry in India
The Indian paint and coatings industry was riding high on the growth in the Indian automobile
industry, new construction in the housing segment and improving infrastructure throughout the
country. Thus, there has been a higher growth of emulsion paints for interiors vise-versa
distempers. There is increasing use of economy emulsion in place of lower-priced distempers.
Similar is the trend for exteriors where emulsion-based coatings are now preferred against
conventional cement-based coatings. In spite of economic slowdown, the Indian paint industry is
growing though at a slower rate. It has tremendous potential for growth in the coming years. The
decorative segment has outpaced the industrial segment in growth rate but the industrial segment
has the greater potential for growth, as and when the automobile industry business improves. The
players with aggressive marketing strategies and comprehensive product portfolios will grow at a
faster rate. The emerging trends in technology and marketing indicate that the industry is likely
to consolidate in the coming years with industry leaders improving their market share.
Consumers are looking forward to new product launches some for application in special areas.
Companies are increasing the value-added services available to customers by offering a variety
of finishes through specialized and trained applicators, well supported by back end support of
specialized service. Moreover, consumers are continuously looking for better products, more and
more consumers are switching to marginally higher-priced emulsions where they get more
durable and better-looking finishes in a wider range of colours. Disposable income plays a
critical role in the decorative paint market. Thus, increase in people’s income will help the
industry to grow. Moreover, the rural sector has a major share of the decorative paints segment.
Thus, any benefit to the rural sector for improving the dispensable income is directly corelated to
the growth of the paint industry. Besides, decorative paints are marketing savvy products backed
by large advertisement campaigns and dealership networks. Huge investments required in setting
up a vast marketing and dealership network, to advertise and develop a brand over a period of
time will also help the industry to reach new heights. The supporting speculations for
infrastructure, commercial and industrial consumers are like increased repainting activity,
globalisation resulting in mega projects managed by international consultants, Boom in the
Indian Housing Sector, increasing urbanisation, Shift from semi-permanent to permanent

housing structures. In a similar way strong industrial growth and heavy infrastructure spending,
new projects pertaining to roads, ports and industrial segments is a positive sign for encouraging
industrial coat segments.
Changing Marketing Practices
The decorative paints industry, one of the main two categories (the other being industrial paints),
constitutes a significant part of the total paint market in India, and been making rapid strides too.
There is a great silver lining for the industry. With the boom in the construction industry, the
demand for decorative paint is growing approximately at 17-18 per cent per annum. This figure
sounds challenging, but this is the fact. Currently, two types of demand are witnessed in
decorative paints sector - from new projects and recoating.
Factors Influencing Buying Behaviour of Consumers
As a consumer product that is being sold to a young, increasingly more affluent customer, key
success factors in decorative paints are as below: •Brand: Paints are becoming a high
involvement purchase for the end use consumer, hence the brand plays a key role in determining
his choice, both for new construction and repainting activities •Product portfolio: It is essential
for paints companies to have a judicious mix of targeted products for its core customer along
with a complete product portfolio across product categories and price points for the entire
customer universe •Distribution: Sales of decorative paints requires extensive dealer networks,
especially in the rural and semi-urban markets; hence a strong supply chain and pan-India
distribution presence is essential
Challenges Faced by the Paint Industry
Some of the prominent challenges for Indian paint industry are: · Seasonal Demand: Paint
Industry is a seasonal industry. The demand shoots up during the Diwali season or other festive
seasons and it will be low in the rainy season. · Inventory Management at Dealer Level: The
product differentiation is minimal in paint industry. The very close substitutes are readily
available (e.g. ICI Dulux can be a very close substitute for Asian Paints Royale). Hence the
inventory management at the dealer level is of a prime importance. It is also important for brand
visibility and occupying the shelf space. · Distribution Costs: Distribution costs are important for
a lower price product like Distemper. The Distemper is a stiff paint and is sold on weight basis. It
is called as the “Bread and Butter” of the paint industry as the consumption is highest for this

product. Hence, the cost associated with distribution of it is of prime importance. · Shade
Offerings: As the shades offered by the paints companies are very high in number, (e.g. Asian
paints offers more than 1200 own shades), the problem of distribution becomes very significant.
The demand for a particular shade may peak up suddenly in a particular region. The annum in
US. This shows the lower penetration of the paint industry in the country. The paint companies
have to educate the customers that they should go for the repainting of their houses frequently.
This is a very unique feature of the industry that the Indian people will go for repainting either
for some festival such as Diwali or occasions like Marriage or when the repainting is absolutely
unavoidable. · Competition from the Unorganised Players: A critical challenge in the paints
industry was the competition from the unorganised players; who were not liable for excise as
well as other taxes. Reduction of excise duties over the last few years, from 40per cent to the
present level of 12per cent, has helped to create a level playing field between the unorganised
and organised segments. inventory management at the distributor and dealer level is of great
importance. · Low Per Capita Consumption: As mentioned earlier, the per capita paint
consumption in India is in one of the lowest. It stands at mere 815 gms per person per annum as
compared to the 25 kg per person per annum in US. This shows the lower penetration of the
paint industry in the country. The paint companies have to educate the customers that they
should go for the repainting of their houses frequently. This is a very unique feature of the
industry that the Indian people will go for repainting either for some festival such as Diwali or
occasions like Marriage or when the repainting is absolutely unavoidable. · Competition from the
Unorganised Players: A critical challenge in the paints industry was the competition from the
unorganised players; who were not liable for excise as well as other taxes. Reduction of excise
duties over the last few years, from 40per cent to the present level of 12per cent, has helped to
create a level playing field between the unorganised and organised segments.
Future Outlook for the Paint Industry
Companies are unanimous in saying that the future of the industry is bright. The Indian paint
industry has grown by 1.5-2 times of India’s GDP growth on a year-on-year basis. With the
revival and upswing of economic activities in the country, the paint industry is expected to
witness double digit growth in the current fiscal. Many feel that the growth has just begun, and
the demand will rise in 2015. The per capita consumption of paint in India is estimated to be

more than 800 grams compared to 10 kg in other Asian countries, and above 20 kg in the
developed countries. Against the backdrop of a rapidly changing scenario, even if the per capita
consumption is 2.5 kg, which in all probability is likely to happen in the coming five years, the
industry should witness 100 per cent growth - from approximately `. 25,000 crore to `. 50,000
crore by 2015. Further, the market share of SMEs will remain approximately 50 per cent, as the
customers are gradually recognizing their quality. The prospect of the industry further brightens
with setting up of shops by prospective global paint manufacturers in India. The outlook is
promising, and the industry is estimated to grow by 15 per cent on an annual basis. Prediction of
normal monsoon has provided further momentum to the sector. The industry should continue to
grow handsomely, as the monsoon is projected to be normal, and GDP is being projected to grow
in touching 8 per cent in the coming months. However, there exists a risk factor due to sharp
increase in raw material prices from the beginning of the current financial year. This could affect
the margins of paint companies substantially. Going by the current trend and customers’ attitude,
the future augurs well for the industry. What is positive for the industry is that today people in
rural India also feels it a necessity rather than a luxury to paint their houses every year, which is
indeed a significant change of thought.

BIBLIOGRAPHY
 Annual Reports of Asian Paints
Websites:
 https://www.asianpaints.com
 http://www.nationaltradersco.in/
 https://www.asianpaints.com/content/dam/asianpaints/website/secondarynavigation/inves
tors/financial-results-2/2014/annual-report-14-15.pdf
 https://www.asianpaints.com/content/dam/asianpaints/website/secondary-
navigation/about-us/corporate-citizenship/BR%20Report%20FY%202014-15.pdf
 http://articles.economictimes.indiatimes.com/keyword/asian-paints
 http://www.business-standard.com/article/management/asian-paints-reaps-its-headstart-
113082101170_1.html

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