Mumbai: A 57 per cent market share in the automotive paints segment makes Kansai Nerolac the largest segmental player. However, its share in the more lucrative decorative paints, which is 75 per cent of the Rs 55,000-crore domestic industry, is only 11 per cent yet fetches 55 per cent of revenue. The automotive segment fetches 45 per cent revenue to the company. The nearly Rs 5,000-crore Kansai Nerolac, which is 75 per cent owned by the world’s eighth largest player Kansai Paint Co of Japan, overall enjoys 18 per cent market share, making it the second largest player after Asian Paints. The top three–Asian Paints, Nerolac and Berger Paints—control around 60 per cent of the industry.
“Expecting better demand ahead, we are adding 40,000 litres capacity at our Amritsar plant and would be investing Rs 450 crore in capex, most of which will be spent this year,” he said. He said demand is led by the decorative segment which saw a sharper than anticipated recovery already thanks to the rural and semi-urban markets. Fortunately, industrial segment has also shown signs of revival from August and we expect this to improve further as we approach the festival season, he said.
Nerolac, which is the first domestic paints maker to launch a lead-free paint and an industry-first anti-fungal bio-wash recently, has 5.4 lakh litres of capacity across its six plants. The new addition will take the output to 5.8 lakh litres, he said. Its six manufacturing plants are at Jainpur in UP, Bawal in Haryana, Chiplun in Maharashtra, Hosur in Tamil Nadu, Sayakha in Gujarat and Amritsar in Punjab and the seventh one is proposed in Visakhapatnam in Andhra Pradesh, which Bharuka said is being postponed by a year due to the pandemic.
