The unparalleled growth on the housing sector front, brisk urbanisation, availability of easy housing loans, all have been instrumental in the growth of decorative paint segment, which comprises 70 percent of the 21,000 crore paint industry in India. An average growth of about 18 percent in the automobile sector contributes 50 percent to the revenues in the industrial paints segment. Industrial paints add 30 percent to the paint industry revenue in India. New developments in roads, ports, etc add up to the revenues of protective coatings for civil applications.
In the last ten years, the industry has grown at a compounded annual growth rate (CAGR) of 18-20 per cent.
Paints can be classified into two segments 1] Decorative Paints 2] Industrial Paints
Decorative Paints are meant for the housing sector. Distemper is affordable and used in the suburban and rural markets. Interestingly, 20 percent of all decorative paints in India are distempers.
Indian paint products are highly in demand in countries of United States, China, India, United Kingdom, Australia, Pakistan, Hong Kong, Canada etc.
Prominent destinations to source paint products from India include:Mumbai, Ahmedabad, Coimbatore, New Delhi, Surat, Chennai, Delhi, Jaipur, Bangalore, Kolkata, Karur, Tirupur, Ludhiana, Bhilwara, Erode, Jodhpur, Rajkot, Noida, Panipat, Amritsar, Thane, Shanghai, Pune, Karachi, Vadodara, Kanpur, Madurai, Gurgaon, Hyderabad, Navi Mumbai, Tiruppur, Faridabad, Indore, Ghaziabad, Varanasi, Faisalabad, Alappuzha.
Emerging trends in the decorative industry
* Consumers are increasingly involved in making purchase decisions.
* Consumers expect better and more relevant functional benefits from paints.
* Emulsion paints are outgrowing the industry growth rate.
* Trend of dark shades complementing light shades continues.
* Tinting systems at store level are the order of the day.
* Companies are getting more consumer-centric and a lot of value-added services are being offered, like application support, colour consultancy etc.
The breakup between repainting and new construction is 70:30 on the whole. This ratio changes in the metros and mini metros to 55:45 between repainting and new construction.
Architectural/Decoration sector composition
Enamels-50 per cent
Distemper- 19 per cent
Emulsions- 17 per cent
Exterior Coatings- 12 per cent
Wood Finishes- 2 per cent
What’s in stores?
* If you are going for the largest paint company in India, Asian Paints, you may choose shades of pastel, melange, accent, glitter, special shades etc from their brands: Ace, Royale, Apex, Duracast, Utsav, Tractor Emulsion, Royal Shyne, Wood finishes etc.
* Kansai Nerolac offers Vastu and Shaadi colours from Impressions, Beauty and Excel.
Where Asian Paints is regular with Sharad Samman in Durga Puja where they do contests to keep the consumer interest alive, other companies are following suit.
* Berger Lewis has some interesting plans this season that Subir Bose, MD, reveals, “We have opened Berger Paint Centres, the idea behind which is to offer a great experience to paint consumers. And for the purpose, we are opening franchise centres in Tamil Nadu and Andhra Pradesh. We want to provide a touch feel of paint to consumers through options in terms of colour schemes for their homes. We also have preview software installed in these stores by which we can show the consumers various colour options both for the interior and the exterior of his house. A colour consultant is available in these outlets, who can advice the consumers on the colour schemes. So, these are the kind of benefits we are providing our consumers through these franchise stores”.
He further adds, “We are doing some new launches to appeal to the consumers for festive season. We have already launched our new advertising campaigns of Easy Clean, which is there in the newspapers. We have re launched Luxol Silk which is a premium emulsion and we will be carrying a new ad that will come 10 days later. Some time back, we launched Weather Coat All Guard, again which our competitors didn’t have. So, these are the kind of new initiatives we are taking and they are working well. The colours are pastel, melange and accent”.
Tips for a win-win situation
With so many paint companies, a customer who has plenty of choice will prefer a company that offers him a single point for hassle free home painting solutions:
* Provide painting job on turnkey basis (Labour+ Material+ Painting+ Accessories).
* Include in your repertoire painting jobs of decorative painting and designer finishes, have a range of kid’s collection.
* Have trained executive who help him regarding the estimate and shade selection.
* Provide the colour consultant on customer’s request.
* Have preview center (for exterior), which will helps him to choose the colour combination; free of cost.
* Have trained painters on your panel.
* Provide shifting & covering of the furniture by your painters.
* Post painting cleanup would be done by your painters.
* Provide *service warranty *.
* Send experienced executive & supervisor to take care of his site on every alternate day.
Overall, offer competitive rates.
Manufacturers are looking at reducing the cost of manufacturing paints which is higher by 24 per cent than in abroad. A lot is going on in R & D and if there is a breakthrough, the reduced costs may make paints cheaper. Moreover, the demand for paints with functional benefits like low VOC coatings, solar reflect coatings etc., is increasing.
Further, post liberalization, with the shackles of FERA (Foreign Exchange Regulations Act) and MRTP (Monopolies & Restrictive Trade Practices Act), taken off, the industry expanded. New Foreign Equity is a very promising new development.
as also companies are being taken over by foreign companies with some foreign companies have actually opened shops in India.
The good news is that Indian manufacturers hardly face any threat from foreign players. Add to it, many having tied-up with global players in terms of latest technology and market accessibility. Unfortunately, reduction of import duty from 40 per cent to 15.3 per cent over the last eight years hasn't reallycontributed the growth of this sector, but apart from this, other factors do promise an upward trend of 18-20 per cent every year for this industry.