ASIAN PAINTS

PRESENTED BY: GOPAL RATHI

asian paints

INDUSTRIAL MARKET IN INDIA

As industrialization gathers pace in the country, industrial coatings is expected to grow at a faster rate

In India the industrial paint segment accounts for 30 percent of the paint market

It is still a fragmented market with number of small companies who are regional/niche/product specific players

Main segments are- powder coatings, protective coating , automotive and marine paints

Nearly 2/3 of this market is dominated by automotive coatingsNew segments and applications for industrial coatings have

emerged in the recent past like road & flooring coating

INDUSTRIAL MARKET(CONT.)

Grow at least at 15% per annum powered by the projected high growth in the automotive segment.

industrial paint producers need to be competitive in terms of technology and service.

The top four companies- Nerolac, Asian Paints, Berger and ICI (India)

Nerolac is market leader with 43% of market share while Asian paints has 14 % share

Product differentiation is a key parameter for success suppliers have more control over the price

Asian Paints- Today

INDUSTRIAL SEGMENT of Asian paints

Most of the business operated by Asian PPG Ltd. & Asian paints industrial coating ltd

Company ranks first in automotive & road marking segment & second in protective segment in domestic market

Asian Paints is the second largest player in the industrial coatings segment

Main segments:

– Automotive Coatings– Powder Coatings– Protective Coatings

AUTOMOTIVE COATING

Strong JV (Asian-PPG Industries Ltd) with one of the world’s largest auto OEM coatings companies

(PPG)• With its exclusive and OEM supply contracts with

car companies such as Hyundai, Ford and GM Kansai Nerolac — Leader in the automotive

segment Sales for automotive JV (APPG) increased by 23%

to Rs. 3447 million in 2007 -08

AUTOMOTIVE COATING( CONT.)

Business line in automotive- OEM & Refinish OEM Original Equipment (OE) broadly consists of two sections: Auto OE - (e.g.: Passenger car and MUV manufacturers) General Industrial - (e.g.: 2 wheelers, 3 wheelers, commercial vehicle

auto ancillary manufacturers etc) The Original Equipment (OE) division of AsianPPG has earned the

distinction of being the first Indian paint manufacturing company to be certified with TS 16949. The role of this certification is to fulfill the requirements of AsianPPG's automotive customers through superior products and service

Refinish Nexa Autocolor, Deltron, Delfleet, Bilux, and Aspa brands are the

preferred automotive refinish coatings in their respective categories. They are available in a wide range of colours and in varying pack sizes to suit your style and budget.

POWDER COATING

Fastest growing segment in industrial coatings (~ 12%) High growth due to increase in sales of white goods and auto

ancillaries Acquired powder coatings business of Hawcoplast Chemicals,

pioneer in powder coatings in India, in Nov 2001 Sales for powder coatings business (APICL) increased by

22.3 % to Rs. 477 million in 2007-08 Brands in the powder coating segment include Apcoshield

and Hawcoplast Application segments- Electrical Equipments, Home

Appliances The total capacity will be scaled up to 5,000 MT per annum 

PROTECTIVE COATING

Protective Coatings from Asian paints offer a choice of high-performance, heavy-duty coatings, designed to protect assets against the specific corrosive environment they are exposed to

there is a steady growth due to higher investments in Refinery Segment and power sector, especially Thermal and Nuclear

Today the range of coatings find use across diverse industries such as nuclear, thermal or hydel power plants, chemical, petrochemical or fertilizer plants, refineries, sugar, pulp and paper industry, offshore structures, pharmaceuticals etc

Asian Paints has a strong presence in this segment The company is now the second largest in protective coatings Products- acrylic coating finishers, glass flake coating, heat

resistent coating, conventional coating etc

SWOT ANALYSISSWOT ANALYSIS

WEAKNESSES

Low bargaining power with the suppliers:

OPPORTUNITIES

High growth in both decorative & industrial segment

Potential in overseas markets

THREATS

Growing industry & low capital intensive nature will attract more competition

STRENGTHSNo. 1 in decorative segment & no.

2 in industrial segmentWide range of products with 8500

colorsWide distribution network i.e. 19000

dealersHighest manufacturing capacity strong brand image

FUTURE STRATEGY

• To generate product awareness• Give an incentive to influencer to push/suggest product•To initiate trial for first time user•To explore alliances with worldwide paint majors to tap vast potential of the segment • Leverage the recent acquisition to be a strong player in the industrial coatings business• To expand and become the leading player in international emerging markets• Mass production and economies of scale should be used to reach international price trend•Care should be taken while purchase of raw material as price trend in oil industry follows a cyclic order.

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Future of the Company

Asian Paints is planning to increase the capacity by setting up a plant at Rohtak, Haryana.

No other company is planning to increase its capacity in the near future, this will give Asian Paints a competitive advantage in terms of pricing.

GDP growth slowdown in the growth rate of two important activities i.e. repaint activity and construction activity will have direct impact on the volume of APL, thus effecting its profitability and margins.

Rural markets have considerable potential. Companies that can establish a dealer network in these markets are likely to get the edge in positing above par growth rates over the next few years.

As setting up distribution infrastructure is expensive, it would mean that the competition is limited to the top players.