Industry Overview :
Colors are an inseparable part of human life. From the start of the day to the end of life, there is always some color code for our clothing. Art and other things are also part of Our life. And when it comes to the position of our cars, home, industrial use, Paints industry play key role.
Interestingly in India, the use of Paints is much less. Per capita consumption of Paints in India is around 4kg. That is why it will be easy for the paint industry to grow by 13% per annum soon. As Industrialisation and domestic consumption are expected to grow, with smart cities and other Industrialisation expected to grow, consumption of Paints is also likely to increase. In both broad Categories of Paints, Decorative and Industrial Paints, the growth is expected. But as in India, the supply exceeds demand for Both, and the critical driver is an increase in consumption. As 70% of the paint market is dominated by decorative paint like interior and exterior wall and housing paint, it gives considerable leverage to India.
The critical factor for the paint industry is Raw material, with 300 different Raw materials, out of which a significant part is a Crude Oil. Therefore, lower Crude Oil is Good for the industry.
Company overview
Berger Paints India Ltd, the Kolkata-based company, is the third-largest paint manufacturer and the second-largest decorative paint player in India.
The company was incorporated on December 17, 1923, as Hadfields (India) Ltd in Kolkata. On December 12, 1947, British Paints Holdings acquired the company, and the name was changed to British Paints India Ltd. In 1965, British Paints (Holdings) Limited, UK, was acquired by Celanese Corporation, USA. As a result, the Company’s controlling interest was passed on to CELEURO NV, Holland. In 1969, Celanese Corporation sold its interest in the Indian company to Berger, Jenson Nicholson Limited, UK. In December 1983, the company name was changed to Berger Paints India Ltd. Since 1983, and the company has solely used and developed the name & trademark of Berger and all their other variants in India.
The company holds a distribution network comprising 75 stock points and above 12,000 paint retailers. They have manufacturing facilities in West Bengal, Uttar Pradesh, Pondicherry, Goa, and Jammu & Kashmir. The company is well known for its industrial paint segment. It holds Technical License Agreements with DuPont Performance Coatings in the area of automotive coatings, Nippon Paint Co Ltd for the new generation of automotive coatings Orica Australia Pty Ltd. In the place of protective coatings, TIGERWERK Lack-u. Farbenfabrik GmbH & C. KG, Austria, for specialized powder coatings, and Nippon Bee Chemical Co Ltd for coating on plastic auto parts and mobile phones.
The company Manufactures various segments, including interior and exterior wall coatings and metal and wood paint. The interior wall coatings include internal emulsions: Silk, Breath Easy, Rangoli Easy Clean, Rangoli Super Acrylic Emulsion, Rangoli Super Acrylic Emulsion; designer finishes, which comprised Illusions, Metallica, and Marble; distempers, which include Bison Distemper.
SHAREHOLDING BSE Data
Financials and Ratios. [table id=30 /]
Future Prospects: Even though Asian Paint is the leader in the segment, Berger is catching up. The company was trying Hard to increase brand awareness via ads. The industrial paint segment is the plus point of the company as Asian Paint is majority active in Decorative Paints. This segment is increasing as India is one of the largest manufacturers of cars and Automobiles.
Promoter holding is high, and that is very important for the company. ROCE and Sales growth are essential for anyone, and the company is also performing better here.
