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Introduction

Asian Paints (BSE: 500820, NSE: ASIANPAINT) is an Indian chemicals company headquartered in

Mumbai, India.[3] It manufactures a wide range of paints for decorative and industrial use. Asian Paints

is India's largest paint company and Asia's third largest paint company, with a turnover of Rs 96.32

billion. It is one of the largest paint companies in the world and operates in 17 countries.[4] Besides

Asian Paints, the group operates around the world through its subsidiaries Berger International Limited,

Apco Coatings, SCIB Paints and Taubmans

History

1 February 1942 Armed with little knowledge and great determination, Champaklal H. Choksey,

Chimanlal N. Choksi, Suryakant C. Dani and Arvind R. Vakil get together to manufacture paint in a garage

on Foras Road, Bombay. They name their company 'The Asian Oil & Paint Company', a name that they

picked randomly from a telephone directory.

1945 Asian Paints touches a turnover of Rs. 3,50,000, with an innovative marketing strategy "to reach

consumers in the remotest corners of the country with small packs.

1954 Asian Paints mascot, Gattu, the mischievous kid, is born.

1957 66 The family-owned company makes the transition to a professionally managed organisation.

British company Balmer Lawrie rejects the products of a giant British paint company in favour of Asian

Paints. Asian Paints embarks on an ambitious grassroots marketing campaign, partnering with

thousands of dealers in small towns all over India.

1967 Asian Paints emerges as India's leading paint company ahead of any international competition.

Today Asian paints is one of the largest paint manufacturer in the world and one of the most admired

brands in India.

Major Products and Services

Asian Paints manufactures and markets industrial and decorative coatings. Along with that the company

also provides home painting services and solutions. The company's key products and brands include the

following:

Decorative paints: Interior wall paints, Exterior wall paints, Wood surface paints, Metals surface

paints.[5]

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Industrial coatings: Protective coatings, Floor coatings, Road markings.[6]

Ancillaries: Wall primer, Acrylic Wall Putty, Exterior Wall Putty, Wood Primer. [7]

Asian paints made a foray in automotive paints in the year 1997 with a joint venture with PPG

Industries. The joint venture is called PPG Asian paints.[8] The company manufactures body coatings and

plastic coatings.

Paint brands owned by the company are: Ace & Apex, Apcolite, Apex, Apex Ultima, Asian Paints, Colour

Next, Premium Gloss Enamel, Royale, Royale Play, Touchwood, Tractor Emulsion, Utsav.

Industry Segment Overview :

1. OVERVIEW OF THE PAINTS INDUSTRY The Indian paints industry is currently placed at Rs. 85.0billion and has been showing consistent double-digit growth from 1991. The organized sector

consists of 65-70% whereas the unorganized sector still controls a large portion of 30-35%. The

growth of the domestic paint industry is attributed to the boom in the housing sector and the

strong growth in the automobile sector. The automobile sector has done well over past 10-years with

an average growth of 7-8%. The auto sector is likely to grow at 8-10% due to healthy growth in 2-

wheeler and car segments. However, the volume growth in the paint industry may not be in line with

the auto sector growth, as the quantity of paint per vehicle is declining over a period, due to continuous

innovations. Around 70% of the domestic paint industry revenues come from the decorative

segment, whereas the industrial segment constitutes around 30%. In FY05, the manufacturing sector has

shown good activity with new projects in roads, ports and industrial segments. The Indian paintindustry has a huge potential, as the per capita consumption of paint in India is 800-900 grams

compared to 15-25 kg in the developed countries. The domestic paint industry is poised for good

growth in the coming years. The Indian paint industry is governed by 4 major players and is

largely dependent on the crude oil prices as most of the raw materials are derived from crude oil. The

prices of derivatives of crude oil rose more than crude oil due to the lag effect. Despite the sharp rise in

the crude oil prices in FY05, the industry has reported good growth. The Indian paint industry has

grown at CAGR of 10% or 1.5-2.0x GDP growth. With the expected 7-8% GDP growth in FY06, the

industry is likely to grow at 10.5-12.0%. The decorative segment is likely to do better than the

industrial segment. The decorative segment is likely to grow at 12% whereas the industrial segment is

expected to grow by 8 -10%.

. TECHNOLOGY Dealers and contractors play a very important role in the purchase decision for

paints, as they are major influencers. The town-wise mapping of dealer network is required to ensure

increase in the width of the network, that is, number of dealers across the country; and the depth, that

is, to give consumers a better choice of products. The installation of tinting machines has been an

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important initiative in increasing the penetration and helping the dealers to serve the consumers better,

while decreasing the inventory costs. This will increase decorative sale. The latest value-added service

being provided by the dealer network is the magic eye or spectrophotometer. With the help of this

system, the customer can walk in with a shade in mind and walk out with the paint within minutes.

The machine can conjure up 60,00,000 different colours, as many as the naked eye can detect. This goes

with commitment to provide technological breakthroughs to consumers and will definitely give the

consumers an edge in the market.

4. PAINTS MARKET OF INDIA

Organized Sector can be divided into 2 distinct segments - Industrial Segment growing at 15% (US$

230 million) - Architectural Segment growing at 8% (US$ 500 million)

Overall growth is 10 to 12%

Basic of competition in Architectural segment - Distribution - Brand Image - Range of Products

Basic of competition in Industrial Segment - Access to technology - Technical Servicing

Compounded sales volume growth of the organized Sector was 12% in the last six years.

Entry barriers of decorative paints import - Brand equity of present players - Distribution network -

Cost of modification of products

Top six manufacturers have expanded capacity by 50% to service peak demands. Yet, after opening up of the Indian market, some multinational paint companies are making efforts toget a foothold in the Indian market.

Market size

Total Market size - US$1400 million - Organized Sector - 55% - Unorganized Sector - 45%

Organized Sector dominated by six large players

Unorganized Sector comprising about 2500 units manufacturing various categories of paints.

Total Volume of the Market - 600,000MT

4.10 Tinting Machines

Concept accepted by the Indian Market.

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More than 1500 machines installed in the last five years.

Has changed face of Indian Paint Retailing.

2. TYPES OF PAINTS Two Major Classifications of Paints are: Decorative Paints Caters to the

housing sector Premium decorative paints are acrylic emulsions used mostly in the metros. The

medium range consists of enamels, popular in smaller cities and towns. Distempers are economy

products demanded in the suburban and rural markets Distribution Network is the key Nearly 20

per cent of all decorative paints sold in India are distempers Industrial Paints Include powder

coatings, high performance coating and automotive and marine paints Two-thirds of the

industrial paints produced in the country are automotive paints. Technological superiority and tie-

up with automobile manufacturers

Company overview:

Asian Paints is Indias largest paint company and Asias third largest paint company, with aturnover of Rs 77.06 billion. The group has an enviable reputation in the corporate world for

professionalism, fast track growth, and building shareholder equity. Asian Paints operates in 17countries and has 24 paint manufacturing facilities in the world servicing consumers in over 65

countries. Besides Asian Paints, the group operates around the world through its subsidiaries

Berger International Limited, Apco Coatings, SCIB Paints and Taubmans.

Forbes Global magazine USA ranked Asian Paints among the 200 Best Small Companies in the

World for 2002 and 2003 and presented the 'Best under a Billion' award, to the company. AsianPaints is the only paint company in the world to receive this recognition. Forbes has also rankedAsian Paints among the Best under a Billion companies in Asia In 2005, 06 and 07.

The company has come a long way since its small beginnings in 1942. Four friends who werewilling to take on the world's biggest, most famous paint companies operating in India at that

time set it up as a partnership firm. Over the course of 25 years Asian Paints became a corporate

force and India's leading paints company. Driven by its strong consumer-focus and innovativespirit, the company has been the market leader in paints since 1968. Today it is double the size of

any other paint company in India. Asian Paints manufactures a wide range of paints for

Decorative and Industrial use.

In Decorative paints, Asian Paints is present in all the four segments v.i.z Interior Wall Finishes,

Exterior Wall Finishes, Enamels and Wood Finishes. It also introduced many innovative

concepts in the Indian paint industry like Colour Worlds (Dealer Tinting Systems), HomeSolutions (painting solutions Service), Kids World (painting solutions for kids room), Colour

Next (Prediction of Colour Trends through in-depth research) and Royale Play Special Effect

Paints, just to name a few.

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Asian Paints has always been ahead when it comes to providing consumer experience. It has set

up a Signature Store in Mumbai where consumers are educated on colours and how it can change

their homes.

Vertical integration has seen it diversify into products such as Phthalic Anhydride and

Pentaerythritol, which are used in the paint manufacturing process. Asian Paints also operatesthrough APPG (50:50 JV between Asian Paints and PPG Inc, USA, one of the largest automotive

coatings manufacturer in the world) to service the increasing requirements of the Indian

automotive coatings market. Another 50:50 JV with PPG has been proposed which will servicethe protective, industrial powder, industrial containers and light industrial coatings markets.

International Presence

Today the Asian Paints group operates in 17 countries across the world. It has manufacturing

facilities in each of these countries and is the largest paint company in eleven countries. Thegroup operates in five regions across the world viz. South Asia, South East Asia, South Pacific,

Middle East and Caribbean region through the five corporate brands viz. Asian Paints, BergerInternational, SCIB Paints, Apco Coatings and Taubmans. The Group operates as:

Asian Paintsin South Asia (India, Bangladesh, Nepal and Sri Lanka) SCIB Paintsin Egypt Bergerin South East Asia (Singapore), Middle East (UAE, Bahrain and Oman),

Caribbean (Jamaica, Barbados, Trinidad & Tobago)

Apco Coatingsin South Pacific (Fiji, Tonga, Solomon Islands and Vanuatu) Taubmans in South Pacific (Fiji and Samoa)

The company has a dedicated Group R&D Centre in India and has been one of the pioneering

companies in India for effectively harnessing Information Technology solutions to maximizeefficiency in operations.

Awards & Recognition

Asian Paints included in Asia's Fab 50 List by Forbes Asia Magazine (Sept 2011 Issue) Asian Paints ranked 13th amongst the top paint companies in the world by Coatings

World - Top Companies Report 2010 (July 2011 Issue).

Mr. P M Murty, MD & CEO, Asian Paints conferred upon the 'CEO of the Year' awardby Business Standard, one of Indias leading business daily (March 2011)

Asian Paints receives the Best Audit Committee Award from the Asian Centre forCorporate Governance & Sustainability (Feb 2011)

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

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Forbes Global magazine, USA ranked Asian Paints amongst the 200 'Best SmallCompanies of the world' in 2002 and 2003 and amongst the top 200 'Under a BillionFirms' of Asia in 2005.

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

Received the Ernst

& Young "Entrepreneur of the Year - Manufacturing" award in2003

Today

Asian Paints becomes the 10th largest decorative paint company in the world Asian Paints is more than twice the size of its nearest competitor It is one of the most admired companies in India Present in 22 countries with 27 manufacturing locations, over 2500 SKU's, Integrated SAP - ERP

& i2 - SCM solution

Rated Best Employer by BT-Hewitt survey, 2000 Bluest of the blue chips by Hindu Business Line;Most admired company to work for by ET-BT survey, 2000

On the recommendations of Booz, Allen and Hamilton, Asian Paints restructured itself intoGrowth, Decorative and International business units and adopted SCM and ERP technology

Asian Paints aims to become the 5th largest decorative paint company in the world

Mission Goals and Objective of Asian Paints:

Vision

Asian Paints aims to become one of the top five Decorative coatings companies world-wide by

leveraging its expertise in the higher growth emerging markets. Simultaneously, the companyintends to build long term value in the Industrial coatings business through alliances with

established global partners.

Mission:

To be largest Decorative Paint Co. Worldwide. And To be 5th

largest Manufacturing Paint Co.

World wide.