Asian Paints is India's largest paint company with a turnover of Rs.54.63 billion. It has 28 manufacturing facilities worldwide serving over 65 countries. The company's main product lines are decorative, industrial, and automotive paints. Capacity utilization across its 6 decorative paint plants in India is 75-80%. The company focuses on quality and has received several awards for its manufacturing standards. It sources many raw materials internally but also relies on an extensive supplier base. Asian Paints maintains low inventory levels of 28 days sales through efficient management, while providing high customer service.

1. Operational Analysis<br />11455401025525of<br />Submitted To: Submitted By:<br />Prof. M.H. Verma Chintan Shah<br />Operations Management 09BS0000616<br />IBS – Mumbai Section – D<br />TABLE OF CONTENTS<br />COMPANY BACKGROUND 3<br />PRODUCT LINE 3<br />CAPACITY UTILIZATION 4<br />HUMAN RESOURCES 5<br />QUALITY ISSUES 5<br />SUPPLIER BASE 6<br />INVENTORY MANAGEMENT 6<br />LOGISTICS MANAGEMENT 7<br />ENERGY MANAGEMENT 8<br />CO-ORDINATION & COMMUNICATION BETWEEN PLANTS, OFFICES & VENDORS 8<br />PRODUCT FAILURES, IF ANY 9<br />WASTE AND SCRAP MANAGEMENT 9<br />ENVIRONMENTAL MANAGEMENT10<br />TECHNOLOGY UPGRADATION – MANUFACTURING10<br />R & D11<br />OTHER INITIATIVES11<br />PROFITABILITY12<br />FUTURE OUTLOOK12<br />EPILOGUE13<br />ILLUSTRATIONS14<br />COMPANY BACKGROUND<br />Asian Paints India Ltd. was founded in 1942 as a small partnership firm & now is India's largest paint company. It ranks amongst the top ten decorative coatings companies in the world today, with a turnover of Rs.54.63 billion. Asian Paints operates in 22 countries and has 28 paint manufacturing facilities in the world servicing consumers in over 65 countries. Asian Paints product range includes Decorative Paints, Industrial Paints & Automotive Paints. <br />Besides, the Company operates around the world through its subsidiaries Berger International Limited, Apco Coatings and SCIB Chemicals. Asian Paints has its presence in almost all the segment through its brands Royale in the premium segment, Apcolite in the mid-segment, Gattu, Tractor, Utsav and 3-Mango etc. in the lower segment.<br />PRODUCT LINE<br />Ancillaries:Asian Paints Decoprime Wall Primer WTAsian Paints Decoprime Wall Primer STAsian Paints Acrylic Wall PuttyAsian Paints Wood PrimerAsian Paints Exterior Wall PrimerAsian Paints Knifing Paste FillerAsian Paints Wood StainsAsian Paints Exterior SealerAsian Paints Utsav Floor ColourAsian Paints Utsav Primer (ST)Asian Paints Utsav Primer (WT)Asian Paints Utsav Metal Primer Red OxideAsian Paints Utsav StainerAutomotive:2K Nexa Auto colorDeltronDelfleetBilux range of ProductsAspa range of ProductsDecorative Paints:Exterior WallsAsian Paints AceAsian Paints Apex StretchAsian Paints Apex UltimaInterior WallsAsian Paints Tractor Acrylic DistemperAsian Paints Tractor Synthetic DistemperAsian Paints Utsav Synthetic DistemperMetal SurfaceAsian Paints Luxury Ultra Gloss EnamelAsian Paints Premium Semi Gloss EnamelAsian Paints Utsav EnamelWood SurfaceAsian Paints Utsav EnamelAsian Paints Luxury Ultra Gloss EnamelAsian Paints Premium Semi Gloss EnamelFloor Coatings:APCOFLOR Road Markings:APCOTRAKAPCOTRAK WBRTHERMOLINE CAPACITY UTILIZATION<br />Decorative Paints: <br />Decorative Paints business contributes around 94% in the total paint business. The company ranks no. 1, in the country in this segment with around 8500 colours to offer to its customers. It has 5 manufacturing plants operating all over the country, which is strategically located in-order to cater to the widely spread, market:<br />PlantCapacityBhandup, Mumbai30,000 KL p.a.Ankleshwar, Gujarat1,00,000 KL p.a.Patancheru, Hyderabad80,000 KL p.a.Kasna, NOIDA80,000 KL p.a.Sriperumbudur, Chennai50,000 KL p.a.Kothak1,50,000 KL p.a.Total Capacity4,90,000 KL p.a.<br />In Decorative paint segment, the Company operates in 4 main segments i.e. interior wall finish, Exterior wall finish, Enamels and Wood Finishes. Besides, the company outsources around 25-30% of its total production.<br />Industrial Paint: <br />In this business, the company caters to automotive, powder, protective coatings, road markings segment, floor coatings and General Industrial Paints. Most of the industrial paints business is operated by two companies’ viz. Asian PPG Ltd. and Asian Paints Industrial Coating Ltd. The company ranks first in the automotive paints business in domestic market. The company ranks second in protective segment and first in the road-marking segment. Recently it has entered in floor coating segment. The company operates through following plants:<br />Automotive Coating14,000 KLNon – Industrial CoatingsPowder CoatingBaddi, Himachal PradeshSarigam, Gujarat1800 MT3600 MT<br />Chemicals: <br />Chemical business includes manufacturing of Phthalic Anhydride (PAN) and Pentaerythritol (PENTA). Asian Paints Ltd., has its PAN manufacturing plant at Gujarat (capacity – 25,200 MT) and PENTA manufacturing facility at Tamil Nadu (capacity – 3000 MT). The company consumes nearly 50% of its production as captive consumption and sells the remaining in the open market. This business contributes around 3% to company’s consolidated revenues.<br />Of the above mention total capacity of Asian Paint Plants the total utilization of all the plants is 75 -80% of the total capacity. The plants do not utilize the total capacity of the plants and the other excess paint is being outsourced from other companies. <br />HUMAN RESOURCE<br />Asian Paints believes that people are its strongest assets, for a company can go only as high as its people aim. It is people who innovate and invent, and who engineer the efficiencies that make a business succeed. It is they who drive growth and lead to greater heights. At Asian Paints, human resources systems are designed to create a focused, performance oriented and agile company. A talent pool of over 4700 employees employed across 23 countries brings in a unique blend of mindsets and skills. <br />An open and interactive work culture brings out the best in the people. A sense of ownership and freedom to experiment at their workplace brings out creativity and innovation in every individual. Excellent training is provided to develop leaders and re-strengthen competencies from within the organization. Besides encouraging achievers from within the organization, company also absorbs the best talent from some of the best management and technology institutes in the country. <br />Company hire people who are best suited to the job and whose personal goals are in alignment with company’s’ corporate purpose. Thus, the task is cut out for every individual within the framework of result-orientation, market insight, customer perspective, trust, respect and problem solving. <br />The commitment of its people and their sense of discipline and ownership continue to drive growth for the company. <br />QUALITY ISSUES<br />The company has various manufacturing units which are located at Mumbai, Ankleshwar, Patancheru, Kasna, Cuddalore, Rohtak, Raigad, Buladshahar and Sriperumbudur. Each plant is headed by the Factory Manager. Bhandup plant is the oldest plant with an installed capacity of 30000 Tonnes per annum. All plants are awarded with ISO 9000 & ISO 14000 certification. <br />Asian Paints has won many awards & recognitions which include: <br />Forbes rated it under 200 'Best Small Companies of the world' in 2002 and 2003 and amongst the top 200 'Under a Billion Firms' of Asia in 2005, “Best small company in India” by Asia Money in 2002.

2. “Golden peacock environment management award” national quality award by union labour ministry.

3. “Best supply chain” award by i2 solutions.

4. “Five star rating” by British safety council in 2003 & 2005.

5. Awarded the "Sword of Honour" by the British Safety Council for all the paint plants in India. This award is considered as the pinnacle of achievement in safety across the world.

6. Ranked 24th amongst the top paint companies in the world by Coatings World - Top Companies Report 2006.

7. The Asset - one of Asia's leading financial magazine ranked Asian Paints amongst the leading Indian companies in Corporate Governance in 2002 and 2005.

8. Received the Ernst & Young "Entrepreneur of the Year - Manufacturing" award in 2003.SUPPLIER BASE<br />Mostly the Alkyd resin used in the manufacturing of paints is manufactured by Asian Paints itself, but as the quantity manufactured by it is not enough, the company outsources from many other companies one of it is Piyanshu Resins Pvt. Ltd., Hyderabad

9. Baba Containers is one of the suppliers of 20lit tins to the company.

10. Asian Metal Containers is one of the suppliers of the printed tins to the company.

11. Titanium Dioxide (TiO2) is the largest consumed raw material for manufacture of paints. It constitutes around 30% of the total manufacturing cost. TiO2 is available in two grade i.e. rutile (imported and mainly used by the Indian paint industry) and anatase (manufactured domestically). Travancore Titanium Products, Kerala & Kerala Minerals and Metal Ltd., are some of the suppliers of the TiO2 to the company.

12. Besides TiO2, there are other petroleum based raw materials which constitute around 40-50% of total raw material consumed. Hence any movement in crude oil prices will impact the profitability of the company. These products are mostly supplied by HPCL and BPCL.

13. Sudarshan Chemicals is major suppliers of pigments to the industry.

14. Alpha Chem are the suppliers of driers to the company.