Asian Paints Limited ("APL") is the largest paint company in India, a position it has maintained for over five decades through focusing on customer needs, constant innovation, and building strong brands. APL is investing over ₹40 billion to double its decorative paint manufacturing capacity and expand into home improvement and decor segments. While APL sees this as necessary for future growth, some analysts criticize the moves as "empire building" and a distraction from the core business. The Indian paint industry is dominated by four major players and has experienced strong growth, but still has significant potential for further growth given lower per capita consumption compared to other countries. APL's early focus on rural markets, innovative products and promotions helped it become the
Asian Paints is Asia's third largest paint company with a 38% market share in India. It operates in 17 countries with 24 manufacturing facilities serving over 65 countries. The presentation discussed Asian Paints' global expansion strategy, highlighting its priority markets of Indonesia, Singapore, Philippines, Malaysia, and Thailand due to growing paint industry sizes and competitive advantages. It also covered Asian Paints' history, market size, competition, SWOT analysis, and alternative entry modes into new markets.
This document analyzes the paint industry in India and globally. It discusses key points about the industry structure and major players. The global paint industry is valued at $120 billion annually and is dominated by AkzoNobel, PPG, and Sherwin-Williams. In India, the market is led by Asian Paints and is expected to grow from $40 billion currently to $62 billion by 2016. Porter's five forces model is applied to the Indian paint industry which shows competition is moderate.
The project covers the following topics:
Porter’s 5 Forces Analysis
B2B and B2C Markets
Major Players and Brands
Segmentation
Products in various price segments
Product features
Distribution Strategies of Players
Promotional Activities
SWOT Analysis of Akzo Nobel
Category Extension
Asian Paints is India's largest paint company with a turnover of INR 7750 crore. It has 23 manufacturing facilities across 17 countries. The company aims to become one of the top five decorative coatings companies worldwide by leveraging expertise in emerging markets. It has a vision of building long term value in industrial coatings through global partnerships. Asian Paints focuses on margin expansion through input cost control, R&D efficiencies, and improved chemical business realizations.
Paint industry porters five force & pestel analysisRarichan Mathew
The document analyzes the paint industry in India. It discusses that the paint industry has grown at a CAGR of 17% over the past 7 years and was worth Rs. 26,040 crore in FY2012. Asian Paints has the largest market share of 49% in India. The document also outlines the major players in the industry, key factors influencing the industry according to PESTEL and Porter's Five Forces analysis, and future prospects of growth in the decorative paints segment.
The document discusses the Indian consumer durables industry. It notes that the industry size is Rs. 350 billion and is dominated by categories like white goods, brown goods, and consumer electronics. It is dominated by Korean majors like LG and Samsung. The document further describes the different categories and products within white goods, brown goods, and consumer electronics. It provides market sizes and growth rates for various products. It also lists key drivers of growth in the industry as well as opportunities and threats.
The Chotukool is an innovative tiny refrigerator manufactured by Godrej for rural Indian markets. It uses a computer fan instead of a compressor to keep items cool without electricity for hours while using half the power of traditional refrigerators. Priced at Rs. 3790, it can hold 5-6 water bottles and 3-4 kg of vegetables, and its small size and portability allow it to be easily moved for community gatherings. Godrej marketed the Chotukool through partnerships with India Post and microfinance institutions to maximize rural reach.
Asian Paints is Asia's third largest paint company with a 38% market share in India. It operates in 17 countries with 24 manufacturing facilities serving over 65 countries. The presentation discussed Asian Paints' global expansion strategy, highlighting its priority markets of Indonesia, Singapore, Philippines, Malaysia, and Thailand due to growing paint industry sizes and competitive advantages. It also covered Asian Paints' history, market size, competition, SWOT analysis, and alternative entry modes into new markets.
This document analyzes the paint industry in India and globally. It discusses key points about the industry structure and major players. The global paint industry is valued at $120 billion annually and is dominated by AkzoNobel, PPG, and Sherwin-Williams. In India, the market is led by Asian Paints and is expected to grow from $40 billion currently to $62 billion by 2016. Porter's five forces model is applied to the Indian paint industry which shows competition is moderate.
The project covers the following topics:
Porter’s 5 Forces Analysis
B2B and B2C Markets
Major Players and Brands
Segmentation
Products in various price segments
Product features
Distribution Strategies of Players
Promotional Activities
SWOT Analysis of Akzo Nobel
Category Extension
Asian Paints is India's largest paint company with a turnover of INR 7750 crore. It has 23 manufacturing facilities across 17 countries. The company aims to become one of the top five decorative coatings companies worldwide by leveraging expertise in emerging markets. It has a vision of building long term value in industrial coatings through global partnerships. Asian Paints focuses on margin expansion through input cost control, R&D efficiencies, and improved chemical business realizations.
Paint industry porters five force & pestel analysisRarichan Mathew
The document analyzes the paint industry in India. It discusses that the paint industry has grown at a CAGR of 17% over the past 7 years and was worth Rs. 26,040 crore in FY2012. Asian Paints has the largest market share of 49% in India. The document also outlines the major players in the industry, key factors influencing the industry according to PESTEL and Porter's Five Forces analysis, and future prospects of growth in the decorative paints segment.
The document discusses the Indian consumer durables industry. It notes that the industry size is Rs. 350 billion and is dominated by categories like white goods, brown goods, and consumer electronics. It is dominated by Korean majors like LG and Samsung. The document further describes the different categories and products within white goods, brown goods, and consumer electronics. It provides market sizes and growth rates for various products. It also lists key drivers of growth in the industry as well as opportunities and threats.
The Chotukool is an innovative tiny refrigerator manufactured by Godrej for rural Indian markets. It uses a computer fan instead of a compressor to keep items cool without electricity for hours while using half the power of traditional refrigerators. Priced at Rs. 3790, it can hold 5-6 water bottles and 3-4 kg of vegetables, and its small size and portability allow it to be easily moved for community gatherings. Godrej marketed the Chotukool through partnerships with India Post and microfinance institutions to maximize rural reach.
Analysis of PAint industry (SWOT)
SWOT of decorative paint and industrial paint segment
SWOT of Asian Paints
Recommendations/ future strategy for asian paints
Asian Paints is India's largest paint company established in 1942. It has a turnover of Rs. 109.70 billion and operates in 17 countries with 25 manufacturing facilities worldwide serving over 65 countries. The company has a 50% joint venture with PPG Inc. for automotive coatings and another 50% JV with PPG for industrial coatings. Asian Paints has a presence in South Asia, Southeast Asia, the Middle East, the Pacific and the Caribbean. It is the largest paint company in 11 countries that it operates in. The company manufactures decorative and industrial paints as well as provides home painting services. Its major competitors in India include Nerolac, Berger and ICI.
The presentation discusses India's "Make in India" campaign, which was launched in 2014 to promote manufacturing in India. It aims to transform India into a global manufacturing hub and improve the country's economic growth and development. The campaign focuses on 25 key sectors and aims to attract foreign investment, boost job creation, and improve skills training. It also outlines reforms to improve India's business regulations and processes to make it easier for companies to invest and produce goods in India. The goal is for India to increase its manufacturing contribution to the economy and become more competitive globally through this campaign.
Analysis of Paint Industry, Modes of Packaging and Usage of TIN in Paint Indu...Sautrik D. Mantrani
TCIL is essentially a B2B company that derives its revenue indirectly from its end-user segments
Primary Objectives:
P1: To assess the consumption trend of tinplate packaging for various SKUs of paints sector.
P1: To assess present cumulative tinplate consumption for packaging in paints industry vis-à-vis overall tinplate production in India.
P1: To provide a template for TCIL to estimate and validate tinplate demand in the paint packaging end-user segment.
Asian Paints has the largest market share of around 32% in the Indian paint industry. The organized sector accounts for around 67% of the market, while the unorganized sector accounts for 35%. Asian Paints, Kansai Nerolac, and Berger Paints are the major players in the organized sector. Asian Paints was founded in 1942 and has grown to become the largest paint company in Asia. It has a presence across multiple countries in South Asia, Southeast Asia, the Middle East, and other regions. The decorative paint segment contributes most to Asian Paints' revenue, followed by industrial paints and automotive coatings.
Asian Paints is an Indian paint company founded in 1942. It has grown to become the largest paint company in India with 55% market share. The presentation provides an overview of Asian Paints' company profile, history since 1942, key people, vision, HR and marketing strategies, subsidiaries, manufacturing plants, SWOT analysis, CSR activities, and future plans to become a top 5 global paint company.
ICI Dulux is a paint company operating in over 55 countries. In Pakistan, it has faced challenges maintaining its image as the premium paint brand as competitors offer more variety and promotions. ICI Dulux historically focused only on quality, but had not launched new variants or planned promotions. This allowed competitors to gain market share. To address this, ICI Dulux launched new initiatives like "Let's Color" community painting projects and product innovations like WeatherShield Sun Reflect paint to strengthen its brand awareness, recognition, and market position in Pakistan.
This presentation contains a glimpse about Asian paints. And there is some of the market analysis that had been done on Asian Paints. Like: - SWOT, PESTLE, STP.
The document provides information about the paint industry in India and Asian Paints. It states that the paint industry in India is estimated at INR 135 billion with 35% of the market being unorganized. Asian Paints started in 1942 and has since become a market leader in India with over 35% market share. It has operations in 17 countries and 23 manufacturing facilities. While it faces threats from competition and raw material price fluctuations, it can leverage opportunities in the rural market and automotive industry.
Infosys established a Knowledge Management department in 1991 to consolidate knowledge gained by employees and provide training. It created a Body of Knowledge that was later moved online and expanded over time. Infosys introduced rewards like Knowledge Currency Units to motivate employees to contribute, but later shifted focus to knowledge sharing culture. It created groups to capture domain and technology expertise and identify champions to strengthen knowledge management practices across the organization.
The Indian paint industry has been growing at around 15% annually with a current market size of approximately Rs. 21,000 crores. The per capita consumption in India is 1.5kg compared to the global average of 15kg. The industry is segmented into decorative paints used in homes and industrial paints used in automotive, engineering and other industries. The major players in the decorative paints segment are Asian Paints, Kansai Nerolac, Berger Paints, and ICI Paints which account for over 70% of the market. The paint industry distribution process involves manufacturers supplying products to regional warehouses and then to dealer networks. Key factors influencing the industry include rising incomes, urbanization, financing availability and
Intel is a US-based semiconductor company founded in 1968. It produces microprocessors, chipsets, flash memory and other products. Intel was initially successful with memory chips but lost market share to Japanese competitors in the 1980s due to stronger manufacturing capabilities. It exited the memory business in 1985. Intel transitioned its focus to microprocessors and used strategic branding and partnerships to dominate the microprocessor market, gaining over 80% share.
The document provides information about the Make in India initiative launched by Prime Minister Narendra Modi on September 25, 2014. It aims to encourage multinational and domestic companies to manufacture products in India. The key objectives are to focus on 25 sectors for job creation, skill enhancement, increase GDP growth, attract capital investment, and minimize environmental impact. It provides details on the history of the initiative, sectors being targeted, foreign investment policies, and responses from some companies.
Winter internship project on berger paintsRishiraj Das
Berger Paints conducted a survey of its master painters and lift and win points program. The objectives were to collect painter details, verify inactive painters, survey tool usage, and help painters increase their points. Most painters were satisfied with paint quality but wanted more quantity. Interior paints were more popular than exterior. Painters were unwilling to buy expensive machines. It was difficult for many painters to increase their points. Recommendations included improved training, rewards, customer service, and education on company schemes.
This document provides information about Shuvadip Shaw, their roll number and section for PGDM III. It then summarizes the key strengths, weaknesses, opportunities and threats for Berger Paints based on a SWOT analysis. Some strengths include their brand perception and market share in India. Weaknesses include dependence on the decorative segment and potential health issues from lead. Opportunities exist in new products and market expansion. Threats include new competition and raw material price fluctuations. The document also briefly mentions Berger Paints' product life cycle, global presence and revenue sources.
presentation on real estate industry in indiaVicky Nishad
The real estate industry in India is one of the fastest growing sectors. It contributes about 5% to India's GDP and is expected to reach $180 billion by 2020. The industry faces strengths such as strong domestic demand and available labor, but also weaknesses like lack of regulations and high investment costs. Opportunities for growth exist in tier 2 cities and increasing office space demand, while threats include skills shortages and delays in project approvals. A SWOT analysis of the Indian real estate industry was presented.
Asian Paints is India's largest paint company founded in 1942. It started with four entrepreneurs in a garage in Mumbai. Today it has a turnover of Rs. 96.32 billion and operates worldwide through subsidiaries. Asian Paints manufactures decorative and industrial paints as well as provides home painting services. It has established itself as a premium brand in India through effective advertising strategies focusing on emotional connections with customers.
Final pestal analysis of construction industry in india AS ON 1 AUGUST 2015Harshit Gupta
This document discusses the PESTAL analysis of the construction industry in India. It outlines various political, economic, social, technological, environmental, and legal factors. Politically, the government has launched various housing schemes to promote affordable housing. Economically, construction accounts for 11% of India's GDP and FDI has been permitted in the industry. Socially, builder reputation influences home buying decisions. Technologically, use of modern techniques improves quality and productivity. Environmental factors like natural disasters can delay projects. Legally, regulations have increased for transparency.
Perception and buying behavior of paint dealer towards berger paintApurv Deshmukh
This document provides an overview of the Indian paint industry and market. It discusses key points such as:
- The Indian paint industry is valued at around Rs. 21,000 crore and is growing at over 15% annually. Decorative paints account for 70% of demand.
- Major players in the organized sector include Asian Paints, Berger Paints, ICI, and Goodlass Nerolac which have a combined market share of around 70%. The unorganized sector makes up the remaining 30% of the market.
- Drivers of growth for the industry include rising incomes, increasing urbanization, expansion of the organized sector, and development of related sectors like real estate and automotive.
This document provides an overview of a study on the relationship between Berger Paints and their dealers in South Tamil Nadu, India. The objectives are to analyze the potential of the dealers, provide a SWOT analysis of Berger Paints, and identify problems in Berger's dealer network to help them regain lost market share. It also provides background on Berger Paints as a company, founded in India in 1923, and currently the second largest paint company. Finally, it reviews the Indian paint industry structure and key drivers of growth.
Analysis of PAint industry (SWOT)
SWOT of decorative paint and industrial paint segment
SWOT of Asian Paints
Recommendations/ future strategy for asian paints
Asian Paints is India's largest paint company established in 1942. It has a turnover of Rs. 109.70 billion and operates in 17 countries with 25 manufacturing facilities worldwide serving over 65 countries. The company has a 50% joint venture with PPG Inc. for automotive coatings and another 50% JV with PPG for industrial coatings. Asian Paints has a presence in South Asia, Southeast Asia, the Middle East, the Pacific and the Caribbean. It is the largest paint company in 11 countries that it operates in. The company manufactures decorative and industrial paints as well as provides home painting services. Its major competitors in India include Nerolac, Berger and ICI.
The presentation discusses India's "Make in India" campaign, which was launched in 2014 to promote manufacturing in India. It aims to transform India into a global manufacturing hub and improve the country's economic growth and development. The campaign focuses on 25 key sectors and aims to attract foreign investment, boost job creation, and improve skills training. It also outlines reforms to improve India's business regulations and processes to make it easier for companies to invest and produce goods in India. The goal is for India to increase its manufacturing contribution to the economy and become more competitive globally through this campaign.
Analysis of Paint Industry, Modes of Packaging and Usage of TIN in Paint Indu...Sautrik D. Mantrani
TCIL is essentially a B2B company that derives its revenue indirectly from its end-user segments
Primary Objectives:
P1: To assess the consumption trend of tinplate packaging for various SKUs of paints sector.
P1: To assess present cumulative tinplate consumption for packaging in paints industry vis-à-vis overall tinplate production in India.
P1: To provide a template for TCIL to estimate and validate tinplate demand in the paint packaging end-user segment.
Asian Paints has the largest market share of around 32% in the Indian paint industry. The organized sector accounts for around 67% of the market, while the unorganized sector accounts for 35%. Asian Paints, Kansai Nerolac, and Berger Paints are the major players in the organized sector. Asian Paints was founded in 1942 and has grown to become the largest paint company in Asia. It has a presence across multiple countries in South Asia, Southeast Asia, the Middle East, and other regions. The decorative paint segment contributes most to Asian Paints' revenue, followed by industrial paints and automotive coatings.
Asian Paints is an Indian paint company founded in 1942. It has grown to become the largest paint company in India with 55% market share. The presentation provides an overview of Asian Paints' company profile, history since 1942, key people, vision, HR and marketing strategies, subsidiaries, manufacturing plants, SWOT analysis, CSR activities, and future plans to become a top 5 global paint company.
ICI Dulux is a paint company operating in over 55 countries. In Pakistan, it has faced challenges maintaining its image as the premium paint brand as competitors offer more variety and promotions. ICI Dulux historically focused only on quality, but had not launched new variants or planned promotions. This allowed competitors to gain market share. To address this, ICI Dulux launched new initiatives like "Let's Color" community painting projects and product innovations like WeatherShield Sun Reflect paint to strengthen its brand awareness, recognition, and market position in Pakistan.
This presentation contains a glimpse about Asian paints. And there is some of the market analysis that had been done on Asian Paints. Like: - SWOT, PESTLE, STP.
The document provides information about the paint industry in India and Asian Paints. It states that the paint industry in India is estimated at INR 135 billion with 35% of the market being unorganized. Asian Paints started in 1942 and has since become a market leader in India with over 35% market share. It has operations in 17 countries and 23 manufacturing facilities. While it faces threats from competition and raw material price fluctuations, it can leverage opportunities in the rural market and automotive industry.
Infosys established a Knowledge Management department in 1991 to consolidate knowledge gained by employees and provide training. It created a Body of Knowledge that was later moved online and expanded over time. Infosys introduced rewards like Knowledge Currency Units to motivate employees to contribute, but later shifted focus to knowledge sharing culture. It created groups to capture domain and technology expertise and identify champions to strengthen knowledge management practices across the organization.
The Indian paint industry has been growing at around 15% annually with a current market size of approximately Rs. 21,000 crores. The per capita consumption in India is 1.5kg compared to the global average of 15kg. The industry is segmented into decorative paints used in homes and industrial paints used in automotive, engineering and other industries. The major players in the decorative paints segment are Asian Paints, Kansai Nerolac, Berger Paints, and ICI Paints which account for over 70% of the market. The paint industry distribution process involves manufacturers supplying products to regional warehouses and then to dealer networks. Key factors influencing the industry include rising incomes, urbanization, financing availability and
Intel is a US-based semiconductor company founded in 1968. It produces microprocessors, chipsets, flash memory and other products. Intel was initially successful with memory chips but lost market share to Japanese competitors in the 1980s due to stronger manufacturing capabilities. It exited the memory business in 1985. Intel transitioned its focus to microprocessors and used strategic branding and partnerships to dominate the microprocessor market, gaining over 80% share.
The document provides information about the Make in India initiative launched by Prime Minister Narendra Modi on September 25, 2014. It aims to encourage multinational and domestic companies to manufacture products in India. The key objectives are to focus on 25 sectors for job creation, skill enhancement, increase GDP growth, attract capital investment, and minimize environmental impact. It provides details on the history of the initiative, sectors being targeted, foreign investment policies, and responses from some companies.
Winter internship project on berger paintsRishiraj Das
Berger Paints conducted a survey of its master painters and lift and win points program. The objectives were to collect painter details, verify inactive painters, survey tool usage, and help painters increase their points. Most painters were satisfied with paint quality but wanted more quantity. Interior paints were more popular than exterior. Painters were unwilling to buy expensive machines. It was difficult for many painters to increase their points. Recommendations included improved training, rewards, customer service, and education on company schemes.
This document provides information about Shuvadip Shaw, their roll number and section for PGDM III. It then summarizes the key strengths, weaknesses, opportunities and threats for Berger Paints based on a SWOT analysis. Some strengths include their brand perception and market share in India. Weaknesses include dependence on the decorative segment and potential health issues from lead. Opportunities exist in new products and market expansion. Threats include new competition and raw material price fluctuations. The document also briefly mentions Berger Paints' product life cycle, global presence and revenue sources.
presentation on real estate industry in indiaVicky Nishad
The real estate industry in India is one of the fastest growing sectors. It contributes about 5% to India's GDP and is expected to reach $180 billion by 2020. The industry faces strengths such as strong domestic demand and available labor, but also weaknesses like lack of regulations and high investment costs. Opportunities for growth exist in tier 2 cities and increasing office space demand, while threats include skills shortages and delays in project approvals. A SWOT analysis of the Indian real estate industry was presented.
Asian Paints is India's largest paint company founded in 1942. It started with four entrepreneurs in a garage in Mumbai. Today it has a turnover of Rs. 96.32 billion and operates worldwide through subsidiaries. Asian Paints manufactures decorative and industrial paints as well as provides home painting services. It has established itself as a premium brand in India through effective advertising strategies focusing on emotional connections with customers.
Final pestal analysis of construction industry in india AS ON 1 AUGUST 2015Harshit Gupta
This document discusses the PESTAL analysis of the construction industry in India. It outlines various political, economic, social, technological, environmental, and legal factors. Politically, the government has launched various housing schemes to promote affordable housing. Economically, construction accounts for 11% of India's GDP and FDI has been permitted in the industry. Socially, builder reputation influences home buying decisions. Technologically, use of modern techniques improves quality and productivity. Environmental factors like natural disasters can delay projects. Legally, regulations have increased for transparency.
Perception and buying behavior of paint dealer towards berger paintApurv Deshmukh
This document provides an overview of the Indian paint industry and market. It discusses key points such as:
- The Indian paint industry is valued at around Rs. 21,000 crore and is growing at over 15% annually. Decorative paints account for 70% of demand.
- Major players in the organized sector include Asian Paints, Berger Paints, ICI, and Goodlass Nerolac which have a combined market share of around 70%. The unorganized sector makes up the remaining 30% of the market.
- Drivers of growth for the industry include rising incomes, increasing urbanization, expansion of the organized sector, and development of related sectors like real estate and automotive.
This document provides an overview of a study on the relationship between Berger Paints and their dealers in South Tamil Nadu, India. The objectives are to analyze the potential of the dealers, provide a SWOT analysis of Berger Paints, and identify problems in Berger's dealer network to help them regain lost market share. It also provides background on Berger Paints as a company, founded in India in 1923, and currently the second largest paint company. Finally, it reviews the Indian paint industry structure and key drivers of growth.
India paint industry opportunity analysis 2018Rajesh Sarma
“India Paint Industry Opportunity Analysis 2018” research report by KuicK Research is an intriguing text that gives detailed facts and analysis on latest developments in the Indian paint industry. Report discusses various segments of the paint industry and analyzes the factors responsible for the growth and the need to resolve challenges to maintain growth momentum in future. Report discusses following aspects related to booming paint industry in India:
Paint Industry Overview
Paint Industry Indicators
Paint Industry Segment Analysis
Urban & Rural Market Potential
Decorative Paint Industry Segment Analysis
Industrial Paint Industry Segment Analysis
Emerging Industry Trends
Paint Industry Distribution Structure
India as Manufacturing & Export Hub
October 2015 Edition of BEACON, A Monthly Newsletter by SIMCON.
Inside this issue:
About Us
Our Team
INDUSTRY ANALYSIS : Paint Industry
COMPANY ANALYSIS : Asian Paints
BRAND ANALYSIS : Cadbury
Concept of the month: The Halo Effect In Marketing
Event Report : Convergence
This document provides an overview of reengineering efforts in the building material industries of paints, stone, tiles, and marble in India. It discusses new technologies and strategies being used to improve production processes and reduce costs for various materials. In the paint industry, color dispensing machines and IT systems have optimized production scheduling and inventory management. For stone, new drilling technologies increase drilling speed while reducing noise and vibration, and fracture detection and repair systems are being developed. The document also provides brief histories and descriptions of the different types of tiles and marbles used in construction.
The document provides information on the paint industry in India. It states that India has over 20,000 paint outlets, the highest of any country. The decorative paint market in India was worth Rs. 30,385 crore in 2016-17 and is expected to grow at a CAGR of 12.2%. Asian Paints has the largest market share of around 53% of the Indian paint market. The document also discusses Porter's five forces analysis of the industry and concludes that competitive rivalry is low to medium and entry barriers are low.
The document provides an overview of the paint industry in India. It discusses that the industry is divided into decorative and industrial segments, with decorative accounting for 70% of demand. It outlines the key players in the organized sector like Asian Paints, Berger Paints, ICI, and Goodlass Nerolac. It also discusses the structure of the industry between organized and unorganized sectors. The industrial paints segment caters to automotive, protective coatings, and accounts for 30% of the market. Major companies have partnerships with international paint makers for technology.
Asian Paints is India's largest paint company with a market share of over 30%. It has a presence in 17 countries. The paint industry in India has been growing at over 15% annually, driven by increasing income levels, urbanization, and growth in real estate, automobiles and infrastructure. Asian Paints has leveraged information technology like ERP and SCM solutions to improve efficiency. It has a talented workforce of over 4,700 employees across its global operations. In the financial year 2011-2012, Asian Paints' net revenue increased 25.7% to Rs. 7,964 crores and net profit grew 23.6% to Rs. 958 crores.
A project report on Lewis Berger (exterior wall coating)AasthaThakur14
The document provides information on the paint industry in India. It notes that the industry has two main market segments - industrial paints used for corrosion protection and decorative paints used to protect buildings. The industry is expected to grow 12-13% annually over the next 5 years. The unorganized sector currently controls around 35% of the market. It also provides details on leading companies in the industry like Asian Paints, Berger Paints, and Kansai Nerolac.
Raw Advertisement and Sales Promotion at Asian Paints.docxAmit Pasi
This document provides an overview of Asian Paints, including:
1) It discusses the paint industry profile in India and provides background on the growth of the paint industry.
2) It provides details on the history and background of Asian Paints, describing how it was founded in 1942 and has since become a leading paint company in India.
3) It outlines Asian Paints' vision, mission, quality policy, as well as information on its promoters, product portfolio, and areas of operation.
The document provides an overview of the Indian paint industry. It discusses the history of painting in India dating back to 10,000 BC. It then describes different types of paints available and their uses. It notes that the housing sector and automobile sector drive growth in the decorative and industrial paint segments respectively. The size of the Indian paint industry is estimated to be $2 billion with the organized sector comprising 54% of volume and 65% of value. Asian Paints is highlighted as the market leader with over 50% market share. The document also includes a PESTEL analysis, SWOT analysis, Porter's Five Forces analysis, and future expansion plans of Asian Paints.
The paint industry in India has significantly outperformed market indices and grown over 10,000% in the last 18 years. Major players like Asian Paints, Berger Paints, and Kansai Nerolac have grown between 7,000% to 12,000% in this period. To meet growing demand, the paint industry is now undertaking its most ambitious capital expenditure cycle by massively increasing manufacturing capacity. The four major players - Asian Paints, Kansai Nerolac, Berger Paints, and Akzo Nobel India - control around 75-80% of the market and are each investing over 150 crores of rupees to build new plants. While short term profitability may be impacted, expanded
G 4 global scenario in paint industry -amit jainGn Tewari
This document summarizes trends in the global and Indian paint industries. It notes that the Asia Pacific region is the largest consumer of paint and that countries like China, India, and Southeast Asian nations are driving strong growth due to construction, infrastructure development, and a growing automotive sector. It also discusses challenges facing the Indian paint industry like increases in raw material costs and the need to address sustainability and environmental issues to meet growing customer demand.
This document provides an overview of the paint industry in India. It discusses that while the global paint market is 20 times larger than India's, India's paint market is growing 3 times faster at 15% annually. The top 5 players in the organized Indian paint sector control 61% of the market. Asian Paints leads in sales volume and profits. Decorative paints account for 73% of demand in India, compared to 50% globally. The paper concludes that the Indian paint market is both highly competitive and offers opportunities for further growth.
Dealers preference towards paint companyvikash1808
This document provides an overview of the Indian paint industry including:
- A brief history of the industry and major players.
- Key segments of the industry including decorative and industrial paints.
- Drivers of growth for the industry such as increasing incomes, urbanization, and rural penetration.
- Main concerns including raw material costs and competition from MNCs.
- Top brands in India including Kansai Nerolac, Berger Paints, and Asian Paints.
Paint and Coatings Manufacturing Industry. Project Opportunities in Paint Man...Ajjay Kumar Gupta
Paint and Coatings Manufacturing Industry. Project Opportunities in Paint Manufacturing Sector.
List of Profitable Business Ideas for Production of Paints, Pigments, Enamels, Varnishes, Solvents, Thinners, NC Thinner, Decorative, Domestic, Automotive, Textured & Industrial Paints, Wall Coatings, Primer, Protective Coatings, Wood Primer, Fillers, Undercoats, Putty, Epoxy Paints, Paint Additives
Paints and coatings industry is divided into two sub-sectors namely, industrial and architectural. Architectural coatings include both interior and exterior paints, varnishes, primers, stains, and sealers, and their demand is primarily depended on the growth and performance of the construction sector. Industrial coatings includes coil coatings, automotive paints, refinishers, furniture finishing, and road making paints, and their demand is linked to the growth and performance of the industrial equipment sectors, automotive industry, and appliance industries.
The India paints and coatings market has been segmented on the basis of application into architecture & decorative (interior and exterior), industrial wood coatings, general industrial coatings, automotive OEM, automotive refinish, marine coatings (hull and yacht), consumer durables, packaging coatings, mirror coatings, and others. Based on the technology employed, the market has been segmented into powder coatings, water-borne coatings, solvent-borne coatings, and others. The different types of protective coatings include waterproof, floor/roof, heat resistant, anti-reflective, coil and other coatings.
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The Indian paint industry has grown substantially in recent years and is now the 7th largest in the world, valued at $6 billion. It is expected to continue growing at a double-digit rate of 12-13% over the next 4-5 years to reach $10 billion by 2020. The market is dominated by decorative paints at 70% and led by Asian Paints, Kansai Nerolac, Berger Paints, and AkzoNobel. Key drivers of growth are increased infrastructure development, industrialization, and urbanization. While GST has been neutral for the industry, increased competition and higher manufacturing costs pose challenges.
Asian Paints and Berger Paints are the two largest players in the Indian decorative paint segment, with over 80% of revenues coming from decorative paints. Kansai Nerolac is the leader in the industrial paints segment, with around 45% of revenues from industrial paints. Asian Paints has the largest market share in the Indian paint industry at 39%, followed by Berger Paints at 12% and Kansai Nerolac at 11%. The report provides an overview of the key players in the Indian paint industry and discusses factors driving growth in the decorative and industrial paint segments.
The paint industry in India is expected to grow at 12-13% annually over the next few years, driven by increasing per capita paint consumption which is currently low compared to other countries. Demand for paints comes from the decorative and industrial segments, with decorative paints accounting for over 70% of the market. Key players have expanded production capacity recently which will help meet the projected growth in demand. The industry faces challenges from raw material price volatility and currency fluctuations, but continued economic growth and investment in infrastructure and housing should support double-digit revenue growth for major paint companies in the coming years.
This document discusses customer relationship management (CRM) and various relationship marketing strategies. It covers topics such as the inadequacies of traditional marketing mix approaches, the benefits of relationship marketing like gaining loyal customers, and different types of business relationships from transactional to collaborative. Key aspects of CRM are discussed, including developing trust and commitment between partners. The document also examines customer profitability analysis and strategies for managing both profitable and unprofitable customers.
Retail Management A Strategic Approach, Global Edition by Barry R. Berman, Jo...ShivamYadav8517
This document provides an overview of the 13th edition of the textbook "Retail Management: A Strategic Approach." It includes a brief contents listing the chapters and parts of the book. The preface thanks family members for their support and encouragement of the authors. It also lists the production team involved in creating the global edition of the textbook.
This document discusses various types of strategic coordination such as licensing alliances, partnerships, joint ventures, mergers and acquisitions. It then discusses factors to consider when choosing between acquisitions and alliances such as the types of synergies, nature of resources, extent of redundant resources, degree of market uncertainty, and level of competition. The rest of the document outlines the post-merger integration process including cleaning up and building foundations, strategic and organizational revitalization, and integrating people and operations. It also discusses divestures through various modes such as sell-offs, spin-offs, equity carve-outs and split-ups.
Asian Paints Limited ("APL") is the largest paint company in India that has maintained its leadership position for over five decades. APL is investing over ₹40 billion to double its decorative paint manufacturing capacity and expand into home improvement and decor segments. While APL sees this as necessary for future growth, some analysts criticize these moves as "empire building" that could distract from the core business. The Indian paint industry is dominated by four major players and has experienced strong growth due to rising incomes and consumer aspirations in India. APL's early focus on innovative products, vibrant colors, small packaging, and rural/semi-urban markets helped it become the market leader by 1967.
8 Strategic Alliances_Comparative Analysis of Successful Alliances.pdfShivamYadav8517
This document discusses strategic alliances between companies. It defines strategic alliances as agreements between two or more independent firms to share resources to achieve common objectives. The document outlines different types of strategic alliances, motives for forming them, and compares strategic alliances to traditional relationships, joint ventures, and mergers. It also provides examples of successful strategic alliances between large companies and analyzes factors needed to ensure alliance success, such as integrating organizations at multiple levels.
7 Assessing the Performance of Strategic Alliances.pdfShivamYadav8517
Strategic alliances have become increasingly important for many organizations. However, few organizations formally evaluate alliance performance. The authors propose using a balanced scorecard approach to develop a formal evaluation process. A balanced scorecard links performance measures to alliance objectives. To create an evaluation plan, an organization must understand the rationale, resources, risks, and form of the alliance to determine the appropriate metrics. Relational risks may require controls over decision making, while performance risks focus on short-term financial metrics. The balanced scorecard can be customized to suit different types of alliances.
The document discusses strategic alliances between buyers and suppliers and factors that contribute to their long-term success. It notes that competition is shifting from firm vs firm to supply chain vs supply chain, requiring more cooperative arrangements. However, most alliance efforts fail to meet expectations. The research aims to identify the key success factors for alliances as reported by both buyers and suppliers, and determine if their perspectives are aligned. It focuses on alliances in the food and health/personal care industries.
The document discusses factors that determine the success of strategic alliances between firms. It summarizes that:
1) Alliance success depends on factors at each stage of the alliance life cycle, including partner selection, alliance design, and ongoing management.
2) Key factors for partner selection include complementarity of resources, commitment of the partner, and compatibility of working styles and culture between partners. However, commitment and compatibility may be more important than complementarity under some conditions.
3) Proper alliance design includes setting up appropriate governance to oversee the alliance. Ongoing management requires efforts to realize value from the alliance over time.
4) Emerging issues include alliances with non-profits or individuals
4 Building Scccessful Strategic Alliances_Strategic Process & Analytical Tool...ShivamYadav8517
This document proposes a strategic process and analytical tool for selecting alliance partners. While strategic alliances are important, many fail due to poor partner selection. The authors provide (1) a strategic process for evaluating potential partner industries and firms, and (2) a new analytical tool for partner selection. They illustrate the tool's use by applying it to the global travel industry, noting its applicability to other industries. Selecting appropriate partners is crucial to realizing alliance benefits, yet partner selection receives limited attention. The proposed process and tool aim to address this gap.
3 The competitive advantage of strategic alliances.pdfShivamYadav8517
This document discusses strategic alliances and their competitive advantages. It provides examples of alliances in different industries. Strategic alliances allow companies to access new markets, technologies, and skills. They provide competitive advantages such as entering new markets, confronting competition, overcoming trade barriers, and dividing risks. However, alliances also have disadvantages such as costs, blocking other opportunities, and exposing companies' technologies.
This document provides an overview of strategic alliances and competitive advantages. It discusses how strategic alliances allow firms to combine resources to gain competitive advantages. The document defines strategic alliances and compares them to traditional relationships. It outlines various theories for why firms form alliances, including transaction cost theory and resource dependency theory. The document also discusses different types of strategic alliances and provides examples. The overall purpose is to examine how alliances can reshape competition and what determines the success of firms competing through alliances.
1. The document discusses strategic alliances between companies. Strategic alliances are agreements between independent companies to achieve common goals. They allow companies to access resources and capabilities they cannot develop alone.
2. Alliances have become more common due to factors like globalization, technological changes breaking down sector barriers, and intensifying competition. Companies now form alliances to access new opportunities through constant innovation, in addition to pursuing objectives like market penetration and economies of scale.
3. Goals of alliances include setting global standards, confronting competition, and overcoming protectionist barriers in new markets. Examples are provided.
This document provides an overview of the structure and culture of the Tata Group, a large Indian conglomerate. It discusses how the Tata Group is structured differently than typical Western conglomerates, with its holding companies Tata Sons and Tata Industries owning controlling stakes in diverse business companies. It also describes the unique "Tata-ness" culture that binds the group together. The document outlines various group-level initiatives and services provided to companies, such as the Brand Equity Business Promotion agreement and the Tata Business Excellence Model, which help promote synergies and a common identity across the decentralized group.
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The product workshop focused on exploring the requirements of Generation Z in relation to marketplace dynamics. We delved into their specific needs, examined the specifics in their shopping preferences, and analyzed their preferred methods for accessing information and making purchases within a marketplace. Through the study of real-life cases , we tried to gain valuable insights into enhancing the marketplace experience for Generation Z.
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Quattordicesimo Meetup di Milano, tenutosi a Milano il 23 Maggio 2024 dalle ore 17:00 alle ore 18:30 in presenza e da remoto.
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2. Asian Paints Limited: Painting History
September 2018. Asian Paints Limited (“APL”) was the largest paint company in India, a position it had
comfortably maintained for over five decades by focusing on customer needs and constant innovation in
products, marketing, and service delivery. In the last ten years, the company – which was also the tenth
largest paints company in the world – had grown its revenues over four times, its profits five times, and its
market capitalization nearly ten times (see Exhibit 1). To further accelerate its growth and realize its vision
of being “India’s most exciting and inspirational home décor brand and business”, APL was investing over
₹40 Bni
to double its decorative paints manufacturing capacity and expand its presence in the home
improvement (adhesives, waterproofing, etc.) and decor space (modular kitchens, wardrobes, etc.). KBS
Anand, Managing Director & Chief Executive Officer, remarked:1
We are in the midst of our largest capacity expansion … [the two new] large plants would
give the company the ability to manufacture paints at the lowest cost well into the future.
These decisions, however, were not devoid of skepticism. Ambit Capital, for instance, described these
moves2
as indulging in “empire building”, and venturing into categories which provide “no apparent
synergies” and would prove to be “a distraction in terms of capital as well as management”. It downgraded
APL’s stock to “Sell” (with a target price of ₹860, when APL was trading at ₹1,166):3
We are worried about Asian Paints’ capital allocation decisions around: (1) aggressive
capacity expansion; (2) entry into weak international markets; and (3) acquisitions in home
improvement … the stock trades at a 34% premium to the FMCG sector. We believe this
premium is unjustified … a de-rating for Asian Paints is warranted.
PAINT INDUSTRY: A PRIMER
Paints are colored substances, which when applied on metallic and non-metallic surfaces and allowed to
dry, leave a thin coating that can be for decorative (aesthetics) and/or protective (humidity, air, sunlight,
etc.) purposes. They can also serve other functionalities as required (e.g. fire retardation, luminescence,
solar reflection, waterproofing, insect repelling). There are four primary components of a typical paint:
pigments and extenders (lend color), binders (hold pigment particles together to form a film), solvents (wet
the paint and make it suitable for applying; usually water or organic), and additives (for specific
functionalities mentioned earlier). Although the benefits offered by paints can be achieved in other ways –
by using different base materials (such as stainless steel instead of iron or PVC instead of wood or colored
bricks/concrete blocks that do not require any additional coatings) – these design decisions are not trivial
since the choice of base material is fundamental to the performance of the product. Consequently, while
direct and indirect substitutes exist, these have not disrupted the paint industry per se.
Paint is a raw material intensive industry, with titanium dioxide (a pigment), crude oil (and derivatives),
and mineral turpentine oil as the major inputs. These raw materials typically constitute 15-20%, 35-40%,
and 6-7% of the overall raw material basket,4
respectively, though it varies by product type. Commercial
i
Exchange rate: 1 US $ = ₹71.26.
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3. Asian Paints Limited: Painting History
manufacture5
of paints began in Europe and the United States in the 18th
century. By the middle of the 19th
century, traditional approaches that used manual power gave way to grinding and mixing machines. By the
second half of the 19th
century, the chemical industry emerged and allowed major chemical companies (e.g.
Bayer, DuPont) to develop new innovations in paint technology. By the late 20th
century, production was
done in batches of various types of paints depending on end demand of each type. While large production
volumes offered economies of scale, paints’ high volume-to-value ratio (that made them expensive to
transport) and the need for large variety dictated smaller scales of operation near end markets.
HISTORY OF INDIA’S PAINT INDUSTRY
The first manufacturing unit in India was set up in 1902 by International Paint (a British company). Other
British companies such as ICI, Jenson & Nicholson, and Berger followed soon and shaped the industry’s
early years. However, it was an Indian player – Asian Paints – that became the industry leader in the late
1960s. Several global players such as Nippon Paints (Japan), Sherwin Williams (USA), and Jotun (Norway)
entered the market following India’s economic liberalization in the early 1990s. APL, however,
successfully defended its leadership position, and has dominated the industry for over five decades.
Demand for paint in India was closely correlated with GDP growth (1.2–1.6x of the GDP growth). Over
the years, the industry evolved from being a chemical product to more of a consumer product. Increase in
disposable incomes together with a higher propensity to consume and up-trading by consumers (in search
of superior products) resulted in strong industry growth. The industry grew six-fold – from ₹8,0006
Crii
in
2005 to over ₹50,000 Cr7
in 2018iii
(and expected to grow to ₹70,000 Cr by 2020) – outperforming other
consumption categories such as packaged foods, beauty and personal care, and apparel. Despite this robust
growth, India’s per capita paint consumption of 2.5–3.58,9
kg was much lower than developed countries and
global peers such as China (~12.8 kg) and Brazil (~7.0 kg), signaling considerable growth potential.
In 2018, the Indian market was dominated by four players (“paint majors”): APL, Berger, Kansai Nerolac,
and Akzo Nobel (see Appendix for competitor profiles). This competitive order had been quite steady (see
Exhibit 2) with low disruptions in terms of pricing or discounts, prompting many to describe it as a cozy
oligopoly. This structural characteristic meant that companies could pass input cost fluctuations to
customers and grow profitably. Their scale, distribution muscle, and product development capabilities
afforded the paint majors considerable advantage over the smaller and unorganized players.
The small and unorganized sector consisted of about 2,500 units that were typically located in smaller cities
and focused on lower value decorative products (that had lower technology and quality requirements).
Historically these units had an advantage over the organized players with respect to excise duties and taxes.
Reduction in excise duties (from 40% to 12%) followed by the introduction of the Goods and Services Tax
(GST)iv
eroded this advantage. Also, since pricing was the only lever for the smaller players, their market
ii
1 Cr = 10 million
iii
APL’s net revenue from operations grew over seven-fold from ~₹1,960 Cr to ~₹14,100 Cr during this period.
iv
GST, a value-added tax on the supply (manufacture, sale, consumption) of goods and services, was introduced in July 2017. It subsumed central
excise law, service tax law, VAT, entry tax, octroi, etc., thereby simplifying the indirect tax structure. A key benefit was that it eliminated tax on
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4. Asian Paints Limited: Painting History
share steadily declined from 45% to 35% over the last decade. Unlike some FMCG products (e.g. biscuits,
detergents), outsourcing in paints was limited to lower-end products. The top four players purchased about
30% of their total sales volumes, with the rest manufactured in-house.
PRODUCT SEGMENTS
Paints can be classified into two primary product segments: Decorative/Architectural paints and Industrial
paints (see Exhibit 3). At 70-75% share10,11
of the overall Indian paints market in value terms, the decorative
segment was significantly larger than the industrial segment. Internationally, though, the industrial segment
was typically larger in developed economies, with the global average being 58%.
The decorative segment comprised exterior and interior wall paints (emulsions, enamels, distempers),
primers, varnishes, putties, etc. Their demand stemmed12
from residential (35-40% repainting, 20-25% new
houses), commercial (offices, malls; about 25%) and industrial/institutional (about 15%) users, and saw
significantly higher demand during the festive season (September to December).
Distribution in the decorative segment was direct to retail; there were no wholesale distributors who broke
bulk or helped manage credit to retailers. Hence, paint companies needed to directly deal with thousands
of retailers and manage credit with them (on average, the industry gave credit of three weeks to retailers).
Over the years, all the paint majors had invested heavily in expanding their distribution network (see
Exhibit 4), particularly in rural India. They had also installed Computerized Color Dispensers (“CCDs”)
or tinting machines at a large number of their dealerships. These CCDs could produce large variety of
shades using a small set of standard colors, thereby minimizing inventory requirements at points of sale.
Though CCDs were pioneered in India by Jenson & Nicholson, all paint majors adopted them. CCDs were
manufacturer-specific and required significant space (25–35 sq. ft.), making it very difficult for a new
company to penetrate existing outlets. CCDs had a payback period of three to five years, and typically paint
companies helped their dealers finance the initial outlay of ₹3-4 lakhsv
per CCD.
While buying continued to be heavily influenced by painters, contractors and dealers, involvement of end
consumers in the purchase decision was gradually increasing. Paint consumers were becoming less price-
sensitive and were willing to pay a premium for better products and brands. The industry therefore
witnessed a huge growth in premium products since the late 2000s. This trend was homogeneous across
India, including in small cities. Creative marketing campaigns and sustained endorsements by celebrities
evolved this hitherto low involvement consumer category into an aspirational brand play and created strong
brands for the paint majors, a facet that was challenging for new and smaller players to replicate. That said,
the brand spend of these paint companies was generally lower than that of FMCG players.
Both these aspects – distribution and brand – enabled the top four players to command considerable pricing
power. They were able to pass through cost inflation to consumers at times of high inflation, with APL
tax, i.e. double taxation, which cascaded from the manufacturing level to the consumption level. It was the largest tax reform in the country since
independence and was expected to integrate the economies of the various states in the nation and aid economic growth.
v
10 lakhs = 1 million
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5. Asian Paints Limited: Painting History
usually serving as the benchmark. Short periods of disruptions notwithstanding, the leading players
reportedly maintained competitive order in terms of pricing and promotions.
In contrast, competition in the industrial segment was fierce. High volumes made up for relatively low
margins. This segment generated demand13
from the automobile sector (OEMs and component
manufacturers; about 45%) and a few non-automobile sectors including manufacturing equipment (high
performance coating; about 25%), consumer durables (powder coating; about 15%), and some others (e.g.
marine). Products as well as paint application and delivery equipment typically had to be customized and
jointly developed with the customer. Consequently, this segment was more technology-intensive than the
decorative segment, and required considerable balance sheet strength (for R&D and capex) on the part of
the paint manufacturer. It was, therefore, dominated by the organized sector. Strong client relationships that
often spanned multiple geographies were critical. Investing in customized products commanded
considerable loyalty from customers, and unlike in the decorative segment, distribution strength was not a
key differentiator. However, a minimum reach was required to provide efficient after-sales service.
GROWTH DRIVERS
Rising consumer aspirations were a key growth driver. Increasing disposable incomes resulted in shorter
repainting cycles. In urban centers, repainting cycles shortened from 5-6 years a decade earlier to 2-4 years,
driven, in part, by the introduction of end-to-end painting service solutions by paint companies. Similarly,
rural cycles decreased from 7-8 years to 5-6 years. Consumers also tended to spend more per cycle than
earlier (e.g. upgrading from limewash, locally known as chuna, to more expensive products). As DS Rawat,
Secretary General, ASSOCHAM,vi
pointed out:14
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.
Increasing urbanization and greater awareness about the protective benefits of decorative paints were also
expected to drive demand in tier-2 and tier-3 towns and rural areas. Conversion of kuchha houses
(temporary; made of weak materials such as mud or clay) to pucca ones (permanent; solid) in the rural
sector – an outcome of higher rural disposable incomes – also benefited the paint industry's growth.
Government schemes such as “Housing for all” (by 2022), “Smart Cities Mission”, and “Shyama Prasad
Mukherji Rurban Mission” were also expected to give fillip to the demand for decorative paints.
In the industrial paints segment, India’s growing automotive market was a major factor driving growth.
Going forward, the growing consumer durables (e.g. refrigerators) sector was also likely to play an
important role. The government’s “Make in India” campaign and the push for infrastructure development
(ports, roads, power, etc.) would also drive demand.
vi
Associated Chambers of Commerce and Industry of India.
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6. Asian Paints Limited: Painting History
APL’S COLORFUL JOURNEY
APL was founded in 1942 by four young entrepreneurs – Champaklal Choksey, Chimanlal Choksi,
Suryaknat Dani, and Arvind Vakil – in a garage in Foras Road in Mumbai. Realizing that it would be hard
to compete against the multinational incumbents in the industrial segment, APL opted to focus on the
decorative segment. It sought to differentiate itself in terms of product (vibrant colors versus the light shades
on offer back then), packaging (small packs that allowed customers to paint just the front end of the house),
and target markets (focus on semi-urban and rural areas that remained below the radar of the incumbents).
The focus on semi-urban and rural areas required APL to develop and invest in a strong dealer network, a
practice that it continued to follow. Success with its initial advertising efforts and innovative promotional
campaigns (that targeted, for example, local festivals such as Pola during which Maharashtrian farmers
decorate their bulls) eventually led to the creation of the mascot Gattu. It became one of India's most
recognizable advertising symbols, and more importantly, fostered a strong belief (that persisted) within the
company on building strong brands and effective messaging. Product innovations such as washable
distemper – which were significantly better quality, and less expensive vis-à-vis traditional dry distempers
(limewash), but of inferior quality than plastic emulsion paints – spurred the company to market leadership.
By 1967, APL was the largest paint company in India.
SUSTAINING LEADERSHIP
The 1970s and 1980s were periods of high growth for APL. The company modernized its existing
manufacturing facilities (its plant in Mumbai (Western India) reportedly became the largest single paint
factory in the country), and later expanded its manufacturing footprint by setting up plants in Patancheru
near Hyderabad (South India) and Kasna, Uttar Pradesh (North India). It also backward integrated into
production of resins and other raw materials used in paint production.
In 1982, APL raised money from public capital markets to fund growth. It was among the first businesses
in India to buy a state-of-the-art mainframe computer, and used it to improve demand forecasting,
production planning, reduce inventory and working capital, and improve service levels to dealers. A color
computer imported in 1979 helped dramatically reduce the tinting time from 5-6 days to 4 hours.
To grow and strengthen its talent pool, APL departed from the traditional practice among Indian family-
managed businesses of leveraging the family network. Instead, it started hiring graduates from premier
engineering (Indian Institutes of Technology) and business schools (Indian Institutes of Management). This
was yet another practice it followed even in 2018. It encouraged these hires to take ownership of problems
and assigned significant responsibilities to them early in their career. According to Jalaj Dani, a member of
one of the founding families, “it was never a crime to make mistakes at Asian Paints and the company still
believes so.”15
A structured process of taking feedback from dealers and its sales force resulted in the launch of the highly
successful Mera Wala Color (my choice of color) marketing campaign in 1992
(https://www.youtube.com/watch?v=t91ZeSkKbac). The campaign showcased the company’s extensive
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7. Asian Paints Limited: Painting History
range of colors on offer, and made the consumer feel that she was in charge by enabling her to pick the
exact shade that she considered perfect for her. Amit Syngle, Chief Operating Officer, observed:16
The tagline became so popular that people would go up to stores and ask for mera wala
blue or mera wala green ... It became a generic term and showed the involvement of people
with the campaign.
A year later, building on the insight that people paint their houses on festive occasions and family events
such as weddings, APL launched the Khushi Ke Rang (colors of happiness) campaign
(https://www.youtube.com/watch?v=H-Yy-MrmuP8). It sought to establish a strong emotional connect
with the consumers by linking itself to the spirit of joy and festivity. These efforts clearly helped. For the
first time in 1997, the company – traditionally a leader in the middle and lower segments of the market –
gained leadership of the premium segment. Its Royale brand dislodged the long-standing leader Dulux from
ICI India, the Indian subsidiary of ICI Plc.
Growth of the passenger car market in India, following the entry of Maruti Suzuki, prompted Asian Paints
to foray into the automotive segment. Though the company entered into a technical tie with Nippon Paints
of Japan to source the requisite technology, it failed to gain much traction. Meanwhile, the automotive
sector continued to grow, driven by the entry of global majors in both the two-wheeler and passenger car
segments. In a change of strategy, APL set up a joint venture called PPG Asian Paints with PPG Inc
(formerly Pittsburgh Plate Glass) – the world’s largest coatings company – in 1997 to cater to the
automotive OEM segment. The joint venture became the second largest player behind Kansai Nerolac in
the OEM segment, and the largest in the auto refinish segment (after acquisition of ICI India’s auto refinish
business in 2007). APL and PPG formed another joint venture in 2012 called Asian Paints PPG for non-
automotive industrial coatings.
BATTLE FOR CONTROL
The year 1997 also found the promoters battling for control of the company. After falling out with the other
promoter families over plans for the company’s future and certain governance matters, Atul Choksey – the
then Managing Director and son of co-founder Champaklal Choksey – sold the family’s 9.1% stake to
Kotak Mahindra Capital Company, which further sold it to ICI Plc. The other three co-founders and the
company’s Board viewed this as a takeover threat and refused, as permitted by the then prevailing laws, to
ratify the transfer of the shares to ICI Plc. The British major, however, maintained that this was not a hostile
bid and contended that it sought to acquire the stake with the twin objectives of (a) pre-empting another
competitor (reportedly PPG) from buying it, and (b) exploring a strategic alliance with Asian Paints to
leverage its strength in the middle and lower segments of the market where ICI had little presence. ICI
Chairman AS Ganguly (ex-Chairman, Hindustan Lever Limited) also stated that “[the company] will
explore any position whereby it will be able to gain a dominant position in the market.”17
Ashwin Dani, who took over as Vice Chairman and Managing Director following the exit of Atul Choksey,
viewed the entire process as a hostile effort to take over the company. He said:18
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8. Asian Paints Limited: Painting History
We have the best of technology and the marketing expertise. We do not see any scope for
ICI helping us in our business.
Later, reflecting on the development, he added:19
Value for money is embedded deeply in the psyche of the Indian consumer. No other
market in the world is as deep rooted as India in terms of value for money … [ICI] does
not have distemper paints. And we sell huge quantities of distemper paints. This is poor
man’s paints. Globally not many players sell distemper ... They service only class. We
service class and mass both. What’s more, I am making reasonable profit from distemper
sales and there is growth too in that segment.
After ICI failed to receive permission from the Indian government (which could not do so without the
consent of the APL Board), Kotak Mahindra Capital Company sold half of its stake to UTI (a mutual fund)
and the other half back to the other three promoters, thereby ending the corporate battle.vii
CONSOLIDATING LEADERSHIP
APL hired strategy consulting firm Booz Allen Hamilton in 1997-1998 to help achieve its new and
ambitious growth plans, and to put in a place a structure that separated the roles of ownership, governance
and management. Based on the recommendations, the company restructured its business into three Strategic
Business Units (Decorative Paints, Industrial Paints, and International Operations). Since APL considered
itself to be a promoter-driven but professionally managed company, each new SBU was to be headed by a
professional manager. Ashwin Dani said:20
We have a perfect blend of entrepreneurial and professional management. If a manager has
a bright idea, he has the full independence and support to develop it: he becomes the owner
of the management process.
The promoters also agreed among themselves that sale of shares by any one of them should have the consent
of the other two. Also, all major decisions were to be taken by consensus. With this new understanding, the
management set about consolidating the company’s leadership position.viii
STRENGTHENING DISTRIBUTION
The company followed up on the success of the Mera Wala Color campaign by installing CCDs at dealer
outlets and branded these outlets as Asian Paints Colorworld. Customers could match different shades with
the help of interactive touch screens and specially designed display panels. If a customer wanted a shade
vii
APL bought a 9.2% stake in ICI India in 2003. It offloaded a part of this in 2009 but a 4.3% in what had become AkzoNobel India – the Indian
subsidiary of Dutch chemicals major AkzoNobel, which had acquired ICI Plc in 2008.
viii
In 2009, the three promoters decided to step down from managerial roles and took up non-executive positions. Since then, the company’s CEOs
have been non-family professionals.
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9. Asian Paints Limited: Painting History
that was a combination of two defined shades, the dealer could immediately mix it to her satisfaction using
the state-of-the art equipment. Bharat Puri, then General Manager of Marketing, said:21
Our Mera Wala concept was tailored according to consumer research findings that revealed
that the consumer was becoming more aware and was willing to pay more for some value
addition. At this point in time, we realized that the shade card was the most effective tool
of communication between the company and the customer.
CCDs revolutionized the way paints were sold, and transformed the paint dealer from a trader into a retailer.
Positive reception from customers encouraged the company to scale its Colorworld outlets. In 2018, about
80% of the company’s outlets were Colorworlds. The rollout was enabled, in large part, by the company’s
innovative efforts in helping dealers finance the investment in CCDs. APL orchestrated three-way
agreements wherein banks funded the dealer, who repaid the loan to the bank over time. This way, the
investments were not reflected in the company's balance sheet. Earlier, APL used to bear the initial
investment, which the dealer would repay through lease arrangements. Such support from the company
fostered strong dealer loyalty and further reinforced APL’s distribution network, which grew from 15,000
dealers in 2001 to 52,000 in 2018.
APL was also the first paint company to shift from a manufacturing and distribution focus to a service focus
when it launched Home Solutions, an end-to-end painting service. This service traced its origins to feedback
from a telephone helpline that was started in 1998, where it emerged that 40% of the calls were for turnkey
contract services. By 2018, this helpline was used as a single communication point for Home Solutions. A
customer called and requested a salesperson to visit her house. Once the paints were chosen, APL took care
of the rest of the job including scrubbing and cleaning. While an authorized contractor undertook the actual
painting, APL’s supervisors made regular visits for quality checks. The company also subsequently started
painter training academies to educate and train painters. KBS Anand noted:22
The helpline helped us realize the fact that customers didn't want to take the trouble of
selecting the right color, deciding which paint to buy and from where.
Other innovations (see Exhibit 5) included its signature store Color with Asian Paints in Mumbai set up in
2009. With an area of 7500 sq. ft., this experiential flagship store did not sell paint. Instead, the aim was to
inspire Indian consumers to be more confident with color in their homes and position APL as their home
décor and color experts. KBS Anand explained:23
We wanted to de-mystify the painting category, remove the hassle and make our customers
feel like experts in color and home décor.
The company also operated more than 2000 Ezy Color stores and 380 Color Idea stores all over the country
for end-to-end solutions (color personalization to painting execution), and launched a new format called
AP Homes where customers could have an integrated experience including paints, wall papers, bath fittings,
kitchen, sanitary ware, etc.
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10. Asian Paints Limited: Painting History
RENEWING BRAND AND PRODUCT PORTFOLIO
India’s economic growth spurred changes in consumer behavior. On average, consumers had greater
disposable incomes and were more engaged in the home decoration process, driven by a desire to express
their personality and distinctiveness. Realizing this, APL launched the memorable Har Ghar Kucch Kehta
Hai (every home speaks a story) campaign (https://www.youtube.com/watch?v=Gv-3pqAlRZE and
https://www.youtube.com/watch?v=b_u5C749aKQ). It helped move the APL brand from a color-focused
positioning (Mera Wala Color) to one that invoked pride in one’s home. Over the years, this positioning
helped the company expand its product portfolio to include wallpapers, water-proofing solutions, wood
coatings and more recently kitchens and bathrooms as well. Amit Syngle said:24
Har Ghar Kucch Kehta Hai is a summation of our positioning and an expression which is
timeless and is as relevant today as it was before … [Asian Paints] owns the emotion of
home more powerfully than any other brand in India.
In keeping with this goal of connecting deeply with the customer’s home-related aspirations, the company
launched a new red and yellow (colors chosen to denote warmth) logo in 2002 with the letter `p' in the
company’s name presented in the form of a brush stroke (see Exhibit 6). Gattu, the lovable mascot, was
quietly relegated to just the packaging.ix
. Created by the legendary cartoonist RK Laxman in 1954, Gattu
had helped position Asian Paints as a consumer brand; the mischievous boy got the end consumer interested
in what was then a low involvement category controlled by painters. Even though Gattu’s mass market
appeal was increasingly becoming out of sync with the premium-appeal seeking consumers, the decision to
relegate Gattu to the background was a bold one. Vipul Prakash, Senior VP (Beverages) at PepsiCo India,
who was then at Asian Paints, observed:25
[the company] had the gumption to drop the mascot … We questioned the decision at the
time, but now feel it was right … Asian Paints never dropped its focus on the core offering
… the general tendency is: “The big guys are coming: let’s diversify into A, B or C.”
Instead, it took on the global leaders …. It left them to play catch up.
APL invested heavily in building its brands (see Exhibit 7). Its advertising spend, in absolute terms, was
the highest in the industry. Lower share of the capex-intensive industrial business (which constituted less
than 10% of APL’s revenue) allowed it to aggressively back the decorative portfolio that had expanded
significantly as the company catered to the changing needs of consumers. The launch of Tractor Emulsion
enabled consumers to upgrade from distempers to emulsions. Likewise, the company helped accelerate the
use of paints for exterior applications (paint was traditionally used mainly for interiors) with yet another
clutter-breaking campaign – Wah Sunil Babu (kudos Mr. Sunil) – that used humor to bring to life the durable
nature of its exterior wall paints (https://www.youtube.com/watch?v=qFyN5j16-l0). Yet another example
of APL’s innovation and creativity was the launch of Tractor Emulsion Varna Maalai – a special color
ix
This was the first of two makeovers. Here, the emphasis shifted from a lovable icon to a corporate identity. The second makeover in 2012 is the
present-day flowing ribbon logo.
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11. Asian Paints Limited: Painting History
combination guide designed exclusively for the people of Tamil Nadu based on rooms seen in popular TV
serials. Amit Syngle said:26
With this color combination guide we have taken the brand position even further by helping
consumers choose the right color combinations for their home. It recommends color
combinations that are trendy and that will help their homes stand out.
Critically, APL was among the first companies to identify the premiumization trend among consumers in
India. It enabled the company to build a strong product portfolio in the premium segment (see Exhibit 8),
and shape consumer aspirations of a dream home with its Beautiful Home Guide campaign
(https://www.youtube.com/watch?v=YyPk4OkcpG8). KBS Anand asserted:27
There’s been a massive transformation in the Indian consumer. Earlier, people used to paint
when walls were peeling. Now, it’s about décor. We perceived this before most of our
competition.
The company’s brand equity, in addition to making it top-of-mind for consumers, provided the company
with considerable pricing power (see Exhibit 9). KBS Anand explained:28
Price increases are purely dependent on costs – raw materials and other operating costs. As
these vary depending on the strength of the rupee and international commodity prices, price
changes are entirely based on these in a highly competitive environment. If commodity
prices rise, yes there would be further price increases.
GROWING AND OPTIMIZING OPERATIONS
To realize its ambitious growth plans APL increased its manufacturing capacity aggressively. Over two
decades, it increased its decorative capacity over six-fold (from 180,000 Klpax
in 1999 to 1,130,000 Klpa
in 2018) and expanded its footprint to six paint manufacturing locations (see Exhibit 10). The company
also operated two plants for manufacturing industrial paints and one for chemicals.
Complexity of APL’s operations also grew manifold due to a number of factors: greater scale, more
locations, larger portfolio (brands, faster pace of new product launches), shift in product technology mix
(greater share of water-based paints vs. solvent-based paints), and changes in production pattern (from
producing shades to producing more bases, due to the growing numbers of CCDs at dealer outlets). To
manage the increased complexity, the company systematically leveraged information technology. It
implemented an Enterprise Resource Planning (ERP) system that helped standardize processes and create
a common enterprise-wide platform. Data from shop floor control systems (the new manufacturing plants
were fully automated) and warehouses was linked to the ERP system, thereby enabling operational
efficiencies. A B2B portal linking suppliers drove further efficiencies in the supply chain.
x
Kiloliters per annum. 1 kiloliter = 1000 liters.
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12. Asian Paints Limited: Painting History
The company also centralized its order taking process into a corporate call center. Doing so allowed the
sales team, now armed with mobile devices to monitor dealer performance data, to focus on strengthening
dealer relationships, rather than on routine order collection.
Customer-centric digital initiatives to aid their decision process came next. These included an inspiration
gallery and creative design ideas for end users; sharing, learning and discovery tools for designers; and
simple yet innovative tools such as a budget calculator and a visualization app. The effort was to go
“phygital” – delivering traditionally physical experiences of space, scale, touch and feel digitally – and
making the customer’s world a colorful place.
EXPANDING SCOPE
APL first forayed into international markets (“to test its ability”) when it entered Fiji in 1978. Despite
meeting with success, the company did not expand further as it remained firmly focused on the Indian
market. Ashwin Dani commented:29
No company can operate at international level unless it has a strong home base … If we are
not strong here, we can't operate elsewhere. To be strong in India, we have to deploy a lot
of capital. Had we deployed the same capital overseas 15 years ago, we would have
weakened our position. In the last 15 years, we have continuously gained market share.
By the late 1990s, however, the company’s strong position in the domestic market prompted the leadership
to again explore international markets. The strategy was to acquire loss-making companies – typically those
with valuable assets (brands, customer base, technology, and distribution) – in emerging markets, introduce
operating efficiencies, launch new products and turn these companies around.30
By 2018, APL was present
in 15 countries across four regions: Middle East (UAE, Bahrain, and Oman), Africa (Egypt and Ethiopia),
Asia (Nepal, Sri Lanka, Bangladesh, Singapore, and Indonesia), and South Pacific (Fiji, Tonga, Solomon
Islands, Vanuatu, and Samoa).
The performance of APL’s international business had been a mixed bag. Results were often hit by adverse
currency movements and political turmoil in some of its markets. The company, thus, calibrated its
international footprint suitably; exit from the Caribbean in 2017 (due to low growth) being a case in point.
The company also expanded its product scope when it diversified into home improvement and décor in the
year 2013. As with paints, increased focus on home aesthetics, rising income levels and urbanization were
expected to drive growth in these segments. KBS Anand asserted:31
Home improvement is an aligned business. The basic customer is the same – the
homeowner. This is a large potential market that’s growing. Eventually, we want to be in
all areas of home improvement – from furnishings to bathrooms.
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13. Asian Paints Limited: Painting History
To tap the home improvement opportunity (see Exhibit 11), APL aimed to leverage its distribution network
and brand equity. Through its acquisition of Sleek International in 2013, APL entered the modular kitchen
and wardrobe segments. Through its acquisition of Ess Ess Bathroom Products in 2014, APL entered the
bathroom fittings market and in 2018, launched sanitary ware as well. It sold luxury sanitary ware under
the brand Bathsense, the premium range of bath fittings was branded Royale, and the economy range was
sold under the brand Ess Ess (see Exhibit 12). Its third entry was into the adhesive business (dominated by
Pidilite with over 70% market share) through a distribution tie-up with Henkel (leading adhesive solutions
provider globally). The goal was to leverage network synergy and gain access to thousands of hardware
and décor stores. APL launched three products under the Loctite brand, which was focused on industrial
customers to start with, and was extended to the retail market in certain regions.
THE FINAL COAT
Asian Paints got off to a good start in FY19. Standalone revenuesxi
during the first quarter grew about 16%
year-on-year to ₹3,700 Cr,32
driven by double-digit (14%) volume growth in the decorative paints segment.
The company expected the recent reduction (July 2018) in GST rate (from 28% to 18%) to spur demand
from small consumers and keep volume growth strong. EBITDA for the standalone business increased 38%
year-on-year to ₹820 Cr33
, and PAT went up 35% to ₹540 Cr. Meanwhile, the company’s shares at the close
of business on August 31, 2018, after hitting a 52-week high of ₹1,490, were trading at ₹1,372 (market
capitalization ₹132,000 Cr).
xi
As per the accounting norms in the Companies Act 2013, GST, VAT, etc. (unlike excise duties) are not part of revenue. Accordingly, 1QFY18
revenue adjusted to be net of excise for the purpose of this comparison.
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14. Asian Paints Limited: Painting History
Exhibit 1
Financial Performance (Standalone business) – Last 10 years
RESULTS FOR THE FINANCIAL
INCOME STATEMENT
YEAR FY18** FY17** FY16** FY15^ FY14^ FY13^ FY12^ FY11^ FY10 FY09 FY08
Gross Revenue 16,002 14,360 13,273 13,484 12,043 10,405 9,064 7,202 5,754 5,003 4,063
Net Revenue from Operations 14,154 12,723 11,830 11,649 10,419 8,960 7,964 6,336 5,134 4,279 3,426
Materials Cost 7,983 6,944 6,585 6,440 5,940 5,163 4,746 3,647 2,840 2,607 1,956
Overheads 3,251 3,108 2,769 3,198 2,702 2,249 1,866 1,532 1,275 1,104 908
Operating Profit (EBITDA) 3,198 2,971 2,726 2,197 1,951 1,673 1,493 1,232 1,154 619 615
% to Net Revenue from Operations (%) 22.6 23.4 23.0 18.9 18.7 18.7 18.7 19.4 22.5 14.5 18.0
Finance Costs 21 19 23 27 26 31 31 15 14 10 8
Depreciation 311 295 235 223 212 127 99 94 61 57 44
Profit Before Tax & Exceptional items 2,866 2,657 2,468 1,947 1,713 1,516 1,363 1,122 1,105 546 563
Exceptional item 0 0 (65) (14) (10) 0 0 0 25 (6) 0
Profit Before Tax & after Exceptional items 2,866 2,657 2,403 1,934 1,703 1,516 1,363 1,122 1,105 546 563
Profit After Tax
Return on avg capital employed (ROCE)
Return on avg net worth (RONW) (%)
BALANCE SHEET
(%)
1,895
39
25
1,802
41
28
1,623
45
30
1,327
50
34
1,169
52
35
1,050
54
38
958
59
43
775
62
44
775
78
58
362
51
36
375
61
45
Share Capital 96 96 96 96 96 96 96 96 96 96 96
Reserves and Surplus 7,702 6,999 5,830 4,134 3,505 2,926 2,392 1,879 1,461 999 833
Deferred Tax Liability (Net) 270 261 217 168 177 143 81 76 48 48 32
Borrowings 15 17 38 40 48 54 168 66 69 75 95
Fixed Assets 3,960 2,824 2,722 2,105 2,050 2,154 1,612 1,097 1,088 712 539
Investments
Debt-Equity Ratio
Market Capitalization
CASH FLOW STATEMENT^^
2,577
0.002:1
107,469
2,914
0.002:1
102,970
2,797
0.01:1
83,297
1,894
0.01:1
77,820
1,671
0.01:1
52,559
873
0.02:1
47,139
914
0.07:1
31,056
1,035
0.03:1
24,238
704
0.04: 1
19,593
235
0.07: 1
7,539
423
0.09: 1
11,510
Net cash generated from Operating activities 2,136 1,420 1,980 1,144 1,371 1,081 880 743 848 325 457
Net cash (used in) Investing activities (1,371) (585) (863) (292) (618) (440) (592) (410) (242) (214) (332)
Net cash (used
PER SHARE
in) Financing
DATA
activities (1,239) (956) (704) (728) (560) (591) (297) (320) (239) (222) (127)
Earnings Per Share (EPS)(₹) # *19.8 *18.8 *16.9 *13.8 *12.2 10.9 10.0 8.1 *8.1 * 3.8 3.9
Dividend (%) 870 1,030 750.0 610 530.0 460.0 400.0 320.0 270.0 175.0 170.0
Book Value (₹)
OTHER INFORMATION
81.3 74.0 61.8 44.1 37.5 31.5 25.9 20.6 16.2 11.4 9.7
Number of Employees 6,238 6,156 6,067 5,897 5,555 5,236 4,937 4,640 4,382 4,260 3,924
Number of Shareholders 191,561 202,988 165,986 147,143 87,997 54,813 60,537 59,280 48,290 49,074 47,573
* EPS calculated on Net Profit after Exceptional items.
# With effect from August 1, 2013, face value of the company’s equity share has been subdivided from ₹10 per equity share to ₹1 per equity share and accordingly the EPS and book value for
all comparative periods have been restated.
^ Figures regrouped as per Revised Schedule VI to the Companies Act, 1956. Hence these numbers are not comparable with previous years.
^^ Figures replicated as is (i.e. no adjustments made) from respective annual reports.
** Figures for these years are as per new accounting standards (Ind AS) and Schedule III of Companies Act, 2013. However, Revenue from operations in periods prior to GST implementation
adjusted suitably for Excise duty on sale of goods, to enable comparability of Revenue from operations for these years. ROCE and RONW for these years computed on the basis of figures as
per Ind AS. Hence, these numbers are not comparable with previous years.
Source: Company annual reports
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15. Asian Paints Limited: Painting History
Exhibit 2
Paint Majors – Market Share (by Revenue)
(₹ Cr) FY09 FY12 FY15 FY18
Industry size estimate 20,800 30,400 40,000 50,000
Asian Paints - Revenue 4,079 7,595 11,110 14,154
Berger Paints - Revenue 1,464 2,561 3,655 4,724
Kansai Nerolac - Revenue 1,362 2,562 3,489 4,659
Akzo Nobel - Revenue 900 1,988 2,527 2,719
Paint majors: Total 7,804 14,706 20,782 26,256
Paint majors: Share 37.5% 48.4% 52.0% 52.5%
Source: Company reports, analyst reports, authors’ analysis
Note: Revenue figures are for the standalone entities, excluding non-operating income (e.g. interest income), and net of excise duties and
discounts.
Exhibit 3
Product Segments
Paint Industry
Decorative Industrial
Automotive
Protective coatings
Non-Automotive
Powder coatings Others
Woods Walls Metals
Exterior Interior
Cement paints Emulsions Solvent-based Water-based
Enamels Lusters Distempers Emulsions
Source: Analyst reports, authors’ analysis
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16. Asian Paints Limited: Painting History
Exhibit 4
Paint Majors – Dealer Network
FY01 FY07 FY12 FY16 FY18
Asian Paints
No.
No.
of
of
dealers
CCDs
15,000
2,000
18,000
9,000
28,200
18,000
38,000
29,500
~52,000
~42,000
Berger Paints
No.
No.
of
of
dealers
CCDs
n/a
n/a
10,000
n/a
16,000
9,000
19,000
18,000
~25,000
~20,000
Kansai Nerolac
No.
No.
of
of
dealers
CCDs
8,000
1,200
n/a
n/a
12,000
8,000
12,000
7,800
~20,500
~14,000+
Akzo Nobel
No.
No.
of
of
dealers
CCDs
n/a
n/a
n/a
n/a
8,000
4,000
11,000
8,000
~11,000
~8,000
Source: Company reports, analyst reports, authors’ analysis
Exhibit 5
Innovations in Service Delivery
Innovation Service
Color Next
Predicting color trends by comprehensive trend-mapping exercise conducted
across India with inputs from experts
Special effects/
Textured paints
Creative texture paints with special effects for interior and exterior
requirements
Signature stores Exploring color ideas to get color consultancy by experts
Color Ideas stores
Shop-in-shop format wherein customers can browse through painted/textured
panels and new colors and finishes. Consultancy and visualizer also available
Home Solutions End-to-end painting service, involving expert advice and execution
Color consultancy
@ Home
Expert color consultants to provide advice on colors and designs at home
The New AP Home Store in Coimbatore
Source: Company reports, IDFC Securities report on Indian paint sector (April 2016)
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17. Asian Paints Limited: Painting History
Exhibit 6
Logos over the years
Source: Analyst reports
Exhibit 7
Paint Majors – Advertising spend
FY09 FY12 FY15 FY18
Asian Paints
A&P spend (₹ Cr)
A&P as % of sales
197
4.8%
339
4.5%
597
5.4%
558
3.9%
Berger Paints
A&P spend (₹ Cr)
A&P as % of sales
64
4.3%
137
5.3%
259
7.1%
222
4.7%
Kansai Nerolac
A&P spend (₹ Cr)
A&P as % of sales
47
3.4%
100
3.9%
147
4.2%
275
5.9%
Akzo Nobel
A&P spend (₹ Cr)
A&P as % of sales
66
7.3%
113
5.7%
107
4.2%
108
4.0%
Source: Company reports, analyst reports, authors’ analysis)
Notes:
1. A&P spend excludes cash discounts.
2. Sales figure is for the standalone entities, excluding non-operating income (e.g. interest income), and net of excise duties and discounts.
3. A new accounting standard (IND AS) was implemented during FY16. It impacted how the A&P spend was to be reported.
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18. Asian Paints Limited: Painting History
Exhibit 8
Emulsion Paint – Premium Range (Interior Wall Finish)
Source:Company reports, analyst reports, authors’ analysis
Exhibit 9
Pricing Power
Source: Company reports, analyst reports, authors’ analysis
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19. Asian Paints Limited: Painting History
Exhibit 10
Paints Majors – Manufacturing Footprint
Asian Paints
Berger India
Kansai Nerolac
Akzo Nobel India
500,000 Klpa
Operational
Under development
Industrial paints/Chemicals
600,000 Klpa
Note: Industrial-decorative distinction
is shown if specified by the company
FY11
Capacity
(Klpa)
No. of
plants
Current
Capacity
(Klpa)
Avg.
plant
capacity
No. of
plants
Expected in future
Avg.
Capacity
plant
(Klpa)
capacity
Asian Paints ~600,000 8 ~1,150,000 ~144,000 10 ~2,250,000 ~225,000
Berger Paints ~250,000 13 ~610,000 ~47,000 14 ~850,000 ~60,000
Kansai Nerolac ~220,000 4 ~430,000 ~108,000 7 ~544,000 ~78,000
Akzo Nobel ~90,000 5 n/a n/a 6 n/a n/a
Source: Company reports, analyst reports, authors’ analysis
Notes:
1. APL’s 6,720 MT chemical plant in Tamil Nadu not included in the table, but shown on the map.
For the purpose of this analysis, the capacity of Asian Paints' 7,200 MT industrial paints plant in Gujarat converted to 4,800 Klpa assuming specific
gravity of 1.5 g/cm3
.
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20. Asian Paints Limited: Painting History
Exhibit 11
Home Improvement Opportunity Size
Customer Estimated
Lifetime Value market size Type of market
(₹) (₹ Cr)
Paints 1,400,000 50,000 Organized
Modular kitchens 1,200,000
Hardware n/a 5,000-6,000 Organized share about 40%
Appliances n/a 1,000 Organized
Accessories n/a n/a Unorganized
Solutions n/a 700-800 Local carpenters gradually losing share
Bathroom sanitary
600,000 8,000 Organized share
ware and fittings
about 60%
Source: Analyst reports, authors’ analysis
Exhibit 12
Consolidated Revenue Distribution – FY18
India
FY18 (₹ Cr)
14,662
% of Total
87.0%
Deco-India 13,925 82.7%
Industrial Paints 407 2.4%
Home Improvement
International
330
2,182
2.0%
13.0%
Asia (ex-India)
Middle East
1,035
539
6.1%
3.2%
Africa 467 2.8%
South Pacific 141 0.8%
Total Group 16,844 100.0%
Source: Company reports, analyst reports, authors’ analysis
Notes:
1. “India” numbers are not the same as the “Standalone” figures from Exhibit 1 since the former includes parts of certain other businesses, as
described below.
2. “Deco-India” segment includes decorative paints, adhesives and wall coverings, but the contribution of adhesives and wall coverings within
the segment is <5%.
3. The two industrial JVs are accounted for differently:
a. The first JV (automotive) is accounted as an associate, i.e. not consolidated from the top-line. Only the bottom-line gets consolidated in
the APL consolidated results.
b. The second JV (non-automotive) is accounted as a subsidiary, i.e. consolidated right from top-line up to bottom-line in the APL
consolidated results.
4. Ess Ess is part of APL standalone operations and its results are included in “Standalone” figures.
5. Sleek is a 100% subsidiary and it gets consolidated into APL consolidated results.
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21. Asian Paints Limited: Painting History
Appendix
Competitor profiles (2018)
Berger Paints India
(₹ Cr)xii
FY09 FY12 FY15 FY18
Revenue 1,464 2,561 3,655 4,724
EBITDA 153 308 510 790
EBITDA margin 10% 12% 14% 17%
PAT 89 177 266 432
PAT margin 6% 7% 7% 9%
Market capitalization (August 31, 2018) = ₹32,000 Cr
Kolkata-based Berger Paints (“Berger”) was India’s secondxiii
largest paint company. It was the second
largest player in the decorative segment and third largest in industrial paints. The company’s FY18
standalone revenue and EBITDA were about ₹4,700 Cr and ₹790 Cr, respectively. Its international business
was restricted to a few countries (Bangladesh, Nepal, Poland, and Russia) and accounted for less than 10%
of its consolidated sales.
Until the early 2000s, Berger’s decorative portfolio was aligned more towards the economy segment.
Consequently, the company’s revenue growth lagged behind the industry leader, APL, due to a limited
portfolio of premium products as well as loss of market share in the economy segment as competitors
increased focus on it. Since then, the company gained share in decoratives by making a strong play into
premium emulsions, investing aggressively in brands (Breathe Easy, Silk, WeatherCoat and Allguard) and
expanding distribution. It also acquired the decorative business of Sherwin Williams in 2013 that now
operated as BJN Paints India Ltd. and specialized in textured coatings. Decorative paints now constituted
~80% of its domestic sales, and its dealer network had grown from 10,000 in FY07 to 25,000 currently.
Berger operated a total of 13 manufacturing units in India. It supported its decorative push by increasing
capacity from 250,000 Klpa in FY12 to 609,000 in FY1834
. The company supplemented its strong presence
in North and East India by expanding into West and South India; it expanded its water-based paint Goa
plant and set up a new facility at Hindupur, Andhra Pradesh. It was also setting up a new 200,000 Klpa35
plant at Lucknow, Uttar Pradesh to cater to demand in the Uttar Pradesh-Bihar region.
Berger, over the years, acquired several companies (e.g. Saboo Coatings in 2017, ICI’s motors and
industrial business in 2006), and formed a number of joint ventures (e.g. with Nippon Automotive Paints
in 2007, with Becker – through Berger’s acquisition of Rajdoot Paints – for coil coatings in 1998) and
technical collaboration agreements (e.g. with Tigerwerke for auto refinish in 2004, with Sherwin Williams
for wood coatings in 2013, with Chugoku for marine coatings in 2017) to grow its industrial paints business.
xii
Revenue for standalone business, excluding non-operating income, and net of excise and discounts. EBITDA and PAT taken from annual reports
without any adjustments (Source: Company reports, authors’ analysis).
xiii
Based on consolidated FY18 incomes (including excise duty) of ₹5,328 Cr for Berger and ₹4,879 Cr for KNPL.
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22. Asian Paints Limited: Painting History
It was the market leader in protective coatings. Its products were used by the Indian Railways, power plants,
oil & gas installations, airports, etc. It also manufactured and sold construction chemicals (e.g. waterproof
putty), which are specialty products that extend the structural life of buildings.
In 2015 Berger launched a coloring initiative called Express Painting to provide services of trained painters
(equipped with mechanized tools) for residential units. The company set up training centers, and launched
new products for application through this channel. The strategy was to become an aggregator, create a large
inventory of trained contractors, and premiumize the entire painting process through automated tools. It
also provided value-added services through its protection consultancy services.
The company went through a number of ownership changes in its nearly 100-year history. Started in
Calcutta in 1923 as Hadfield’s (India) Ltd. by an Englishman named George Hadfield, it was acquired first
by British Paints in 1947 and then by Celanese Corp (of US) who in turn sold it to Berger Jenson &
Nicholson (of UK) in 1969. A few years later, the UB Group acquired a controlling stake in the company,
which was bought out by its current promoters, the Dhingras, in 1991. The company claimed to be managed
professionally with the promoter family not a part of day-to-day management.
Kansai Nerolac
(₹ Cr)xiv
FY09 FY12 FY15 FY18
Revenue 1,362 2,562 3,489 4,659
EBITDA 283 362 597 862
EBITDA margin 21% 14% 17% 19%
PAT 166 216 356 516
PAT margin 12% 8% 10% 11%
Market capitalization (August 31, 2018) = ₹28,000 Cr
Kansai Nerolac Paints Limited (“KNPL”) was the third largest paint company in India. It was the market
leader in industrial paints and third largest in the decorative segment. By investing in marketing, new
product launches and distribution, the company had increased focus on the decorative segment. It derived
about 57% of the ₹4,700 Cr total revenue (FY18) from decorative paints and the balance from the industrial
segment. Revenue had grown at a steady pace, increasing by 50% over the last five years. Over the same
period, EBITDA had more than doubled, and was now approximately ₹850 Cr (FY18).
The company operated four manufacturing facilities in India, located at Lote (Maharashtra; Western India),
Bawal (Haryana; North India), Jainpur (Uttar Pradesh; North India), and Hosur (Tamil Nadu; South India).
It was also setting up three new plants in Amritsar (Punjab; North India), Vishakhapatnam (Andhra Pradesh;
South-East India), and Gujarat (West India). Its production capacity was 431,000 Klpa, which was expected
to increase to 544,000 Klpa by FY2036
. KNPL’s distribution network consisted of 20,500 dealers of which
xiv
Revenue for standalone business, excluding non-operating income, and net of excise and discounts. EBITDA and PAT taken from annual reports
without any adjustments, except FY15 PAT (adjusted for one-off exceptional item) (Source: Company reports, authors’ analysis).
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23. Asian Paints Limited: Painting History
14,000+ had CCDs installed. The company also operated in Nepal and Sri Lanka through joint ventures
with Kansai Nepal and Capital Holdings Maharaja Group, respectively.
KNPL started as Gahagan Paints & Varnish Co. Ltd. at Lower Parel in Mumbai in the 1920s and went
public in 1957, establishing itself as Goodlass Nerolac Paints (“GNP”). For a long period of time, GNP
played second fiddle to Asian Paints. In the 1970s, it created a brand around its mascot tiger Goody, possibly
in response to Asian Paints’ Gattu. In 1976, GNP became a part of the Tata Forbes Group. In 1983, it
entered into a technical collaboration agreement with Kansai Paint of Japan, the paint supplier to Suzuki.
GNP leveraged this tie-up to obtain the Maruti contract for automobile painting, and experienced rapid
growth in this segment. In the late 1990s, Kansai Paint took over the entire stake of the Tata Forbes Group
and GNP became a subsidiary of Kansai Paint.
During this period, KNPL also became the leader in sub-contracting production of decorative paints. It
bought goods from the unorganized sector, branded them and sold them through its own retail outlets. The
high excise duty regime prevalent at the time made this an attractive option to increase sales without having
to invest in new production facilities. As part of its growth strategy, the company also set up several joint
ventures such as Polycoat Powders (with Valspar Corporation of USA) for powder coatings and Chemguard
Coatings (with Ameron Coatings of USA) for high performance coatings. The company changed its name
from Goodlass Nerolac Paints to Kansai Nerolac Paints Ltd. in 2006.
KNPL’s parent company, Kansai Paint, was founded in Amagasaki City, Japan in 1918. It was present in
over 80 countries, and with gross sales of over $3 Bn, it was the ninth largest paint company worldwide.
Akzo Nobel India
(₹ Cr)xv
FY09 FY12 FY15 FY18
Revenue 900 1,988 2,527 2,719
EBITDA 203 287 326 339
EBITDA margin 23% 14% 13% 12%
PAT 95 202 186 206
PAT margin 11% 10% 7% 8%
Market capitalization (August 31, 2018) = ₹8,000 Cr
Akzo Nobel India (“ANI”), despite its strong parentage, had remained a distant number four player in the
Indian paints market. Its revenue for FY18 was about ₹2,700 Cr (of which decorative paints contributed
55%) and EBITDA was approximately ₹340 Cr.
ANI became a (73%) subsidiary of Akzo Nobel (one of the two largest coating companies globally) when
the latter acquired ICI Plc (including its India entity, ICI India Ltd) for $16 Bn in 2008. Three years later,
Akzo Nobel consolidated its India footprint into one listed entity that houses all its India paints and specialty
xv
Revenue for standalone business, excluding non-operating income, and net of excise and discounts. EBITDA and PAT taken from annual reports
without any adjustments, except FY09 PAT (adjusted for one-off exceptional item). FY18 figures are for continuing operations only (Source:
Company reports, authors’ analysis).
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24. Asian Paints Limited: Painting History
chemicals businesses. Management’s vision at the time was to achieve €1 Bn revenue by 2015. However,
over the next two years, ANI’s revenue grew at a CAGR of only 10% on account of a slowdown in the
industrial segment and loss of share to the top two players in the decorative segment. EBITDA margin
declined by 100 bps over this period. The company then shifted its focus, at the expense of revenue growth,
to improving profitability.
In 2018, it operated in the decorative market through the Dulux brand, and managed a distribution network
of 11,000 dealers, 8,000 of which had CCDs installed. The company had, in the past, attempted to tap the
mass distemper segment through ICI Magik, though it failed to gain adequate traction. Additionally, most
of its products were as per US/European standards, and generally over-engineered for the Indian market. It
had to re-engineer these to plug gaps in the product portfolio, and subsequently launched several new
products (e.g. Weathershield portfolio). It also increased its focus on brand building, and invested in retail
modernization under the brand Dulux Decorator Centre by setting up over 200 paint outlets in North and
South India. These outlets provided customers an enhanced buying experience through unique initiatives
like visualize your home (customers could upload photographs of their homes and visualize the walls).
The company had five paint manufacturing plants in India – at Mohali (Punjab), Bhind (Madhya Pradesh),
Mumbai (Maharashtra), Hyderabad (Telangana) and Bengaluru (Karnataka), of which the plants at Mohali,
Bhind and Hyderabad manufactured decorative paints. It was also setting up a new 7,000 MT powder
coating plant at Thane (Maharashtra).
Akzo Nobel was a Netherlands-based coating company and was present in over 80 countries, with 200
production sites and leadership in many markets. It recently sold its specialty chemicals operations to
private equity investors to focus solely on the paints and coatings business.
Other international players
Nippon Paints India
Nippon Paints (Japan), Asia’s largest coatings company, entered India in 2006 by setting up a
manufacturing unit in Chennai and has since further augmented its capacity. However, it had not been able
to develop a robust distribution network to grow its decorative business. With respect to its industrial paints
business, in 2015, Nippon Paint Automotive Coatings Company and Berger India agreed to transfer some
of their automotive paints businesses to their existing joint venture, BNB Coating India. Berger transferred
its three- and four-wheeler paints business, while Nippon Paints (India) Pvt. Ltd. transferred its four-
wheeler paints business, other than commercial vehicles, auto parts, and ancillaries, to the joint venture.
Nippon Paint Automotive held a 51% stake in the venture and Berger owned the rest. BNB was mainly
engaged in the business of coatings for plastic substrate of automobiles.
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25. Asian Paints Limited: Painting History
Jotun India
Norway-based Jotun Group established its presence in India in 2005 when it set up a manufacturing unit in
Pune. As with Nippon India, its market share in the domestic paints market was minimal.
Sherwin Williams
Sherwin Williams acquired the paints unit of the Nitco Group in 2006, but had not been able to scale up its
operations in India since then. It sold its decorative business to Berger India in 2013.
ENDNOTES
1
Asian Paints Annual report FY18
2
Ambit Capital report on Asian Paints, February 2017
3
Ambit Capital report on Asian Paints, May 2017
4
Antique Stocking Broking report on Indian Paint Sector report, March 2016
5
“At the Crossroads – The Battle for Colour” Change and Competition in the Indian Paint Industry at the Turn of
the Century, Prof. S. Chandrashekar, June 2004
6
IDFC Securities report on Indian paint sector, April 2016
7
Berger Paints Corporate presentation, 3QFY18
8
Spark report on Indian paint sector, October 2016
9
HDFC Securities report on Berger Paints, July 2017
10
Antique Stocking Broking report on Indian paint sector, March 2016
11
Spark Capital report in Indian paint sector, October 2016
12
Antique Stocking Broking report on Indian paint sector, March 2016
13
IDFC Securities report on Indian paint sector, April 2016
14
Antique Stocking Broking report on Indian Paint Sector report, March 2016
15
HR Katha, April 2017
16
Economic Times, January 2011
17
India Today, September 1997
18
Business Line, The Hindu, September 1997
19
DNA, August 2007
20
Economic Times, November 1997
21
Economic Times, February 1998
22
Business Standard, November 2004
23
Images Retail, July 2009
24
Best Media Info, January 2018
25
ET Brand Equity, August 2018
26
Press Trust of India, November 2014
27
Forbes, August 2013
28
Financial Express, June 2013
29
Hindu, February 2001
30
Economic Times, January 2006
31
Edelweiss Securities report on Asian Paints, May 2014
32
ICICI Securities report on Asian Paints, July 2018
33
IDFC Securities report on Asian Paints, July 2018
34
Business Standard, March 2018
35
Economic Times, February 2018
36
Kansai Nerolac Paints Corporate presentation, March 2018
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