Industry Profile: Colours 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, and industrial use, the Paints industry plays a 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 shortly. As Industrialisation and domestic consumption are expected to grow, with the smart city and other Industrialisation expected to grow, consumption of Paints is also likely to increase. In both broad Categories of Paints, Decorative and Industrial Paints, growth is expected. But as in India, the supply exceeds demand for Both, and the vital driver increases 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 essential factor for the paint industry is Raw material, with 300 different Raw materials, of which a significant part is a Crude Oil. Therefore, lower Crude Oil is Good for the industry.
Company profile: A Mumbai-based company, Kansai Nerolack is an Automotive focused company. The parent, Kansai paint, is Japan’s most significant and the world’s 9th paint company. It is 100% or the most considerable supplier for all automakers like M&M, and Maruti is the biggest customer. The company holds a 35% segment in the industrial part. Total market share of 14%. It recently entered Other components like decorative paints.
Shareholding Pattern: BSE Data
Financials and ratios : [table id=166 /]
Prospects: Maintainance demand for the decorative paint segment is an ample opportunity and will grow double-digit for 20+ years, closure of companies in China due to environmental issues is positive for the sector. Titanium dioxide and crude oil are significant raw materials. However, increasing crude prices is a challenge. Asian paints dominate the paint sector in India, but the industrial paints segment is a big business.
