PAINT INDUSTRY

INTRODUCTION y Industry origin and growth:-

The earliest paint factory in India dates back to 1902, when Shalimar Paints, Colour& Varnish Company, A Pinchin Johnson unit, was established at Calcutta. Growing industrialization, expansion of the railways and introduction of electric power a couple of years earlier had all kept business confidence soaring high. However, this did not provide a ready and expanding market for the nascent paint industry then. Imports from Britain continued to swarm the market and raw materials were not easy to come by. The industry still consisting of one lone unit went through a rather prolonged period of infancy, till the World War II brought in dramatic opportunities. With the stoppage of imports owing to war conditions, the domestic market at last became almost the exclusive reserve of the domestic industry. European manufacturers, hitherto exporting to India, readily saw the advantages of setting up manufacturing facilities here. The period between the wars thus saw the greatest ever influx of foreign paint companies into India- Goodlass Wall (1918), Elphant Oil Mills (1917) in Bombay, and British Paints, Jenson & Nicholson and Macfarlances in Calcutta. Macfarlanes was brought over by the Poddars and became a completely Indian company, while the other three: Shalimar Paints (Pinchin Johnson), British Paints and Jenson Nicholson continued as British operated units. While talking about the post independent development of the Paint industry in India, mention must be made of Asian Paints, a completely Indian unit which started on a very small scale, grew so big and so beyond recognition over the years that it is today not only the largest unit in India but way ahead of the second largest, Kansai (Goodlass) Nerolac Paints Ltd., formerly a unit of Goodlass Wall (UK). Besides Asian Paints, numerous factories, wholly Indian in ownership and with rare exceptions in technology as well were set up in Calcutta, Kanpur and Bombay. The British units, though a few in number, were technically strong and financially sound and, with the active support and patronage of the Government, controlled a vastly higher share of the market. The post independence period witnessed a steady growth in the paint industry. From a mere Rs.200
BERGER PAINTS 1

million turnover in 1950, the paint industry crossed the Rs.14000 million mark in 1990-91. But even in this period, paints were considered a luxury item. Only people with high incomes were expected to decorate their houses with the use of paints. Paints, as a protective element, were totally unheard of. The industrial segment, which was traditionally a low user of paints, visà-vis its counterparts in the decorative segment, too contributed to this notion. In line with this misconceived notion, the government drastically increased duties on paints in the early nineties with an aim to bolster exchequer revenues. The result was obvious. This inevitably brought about a downturn in the fortunes of the industry. The products, which are highly price elastic, saw a negative growth rate of 20 % in 1991-92. The next year was also not good, registering a growth of only 2%, bringing it back to the 1990-91 level, thus corroborating the fact that the industry needed lower excise levels to grow. The industrial slowdown during that periodalso did not help matters. In line with the liberalized policies and the realization that paints are not necessarily a luxury item, duties were progressively reduced from 1993-94. This squared growth as most companies passed on duty reductions. Further, the entry of world majors in the automobile and white goods market in India since 1993 helped the market to expand. Demand for auto paints shot up suddenly. Form a modest 8% growth rate in 1993-94, paint demand touched 12% in 1995-96. Rapid industrialization and improvements in the infrastructure such as transport, energy and communication during the last decade gave a further fillip to the growth of the paint industry. Aided by Government¶s liberal policy of technology import, the automotive and consumer durable segments expanded phenomenally, with a flurry of foreign collaboration. Increased demand for decorative, protective and functional coatings was a natural fall out, which brought, in its stride, a host of indigenous developments as well as the injection of new technology.

BERGER PAINTS

2

History:-

Paint has been used by mankind since its origin. The evidence can be found in the cave paintings. The Chinese are considered to be the pioneers of manufacturing paints thousands of years ago. In modern times paint is made artificially and is used in many different ways. There are three basic things required to make paint. You need a · want· Binder to hold the paint together · Pigment to get the exact color you

Thinner so that it can be applied easily.

Types of PaintsThere are different types of paints available today. Till the 19th century the word paint was used to describe oil-bound types only. The paints bound with glue were called distemper. For farmhouses and cottages an alternative was found and was called lime wash or color wash. Different things need different paints. The interior of the house is painted by different type of paint than the exterior of the house. Automobiles use different type of paint. The industrial paint is different than marine paint. Now colors are made by using different ingredients for specific surfaces. For example enamel paint, when dries it becomes especially hard and usually has glossy finish. The term enamel paint today means hard surfaced paint and usually it is used in reference to paint floor coatings of a gloss finish or spray paints. It can be used for concrete, stairs, porches and patios. Fast dry enamel is ideal for refrigerators, counters and other industrial finishes. Hightemp enamel may be used for engines, brakes and exhaust. Enamel is also used on wood to make it water resistant. The Indian Paint IndustryIn India, Indian Paint industry¶s total market size is US$1400 million. The organized sector of the industry is 55%. The 45% unorganized sector has about 2500 units. The big players and their market share-value of the organized sector are· GoodlassNerolac 15.9% · Berger Paints 13.8% · ICI 11% · Asian Paints 37% ·

Jenson & Nicholson 5.7%

BERGER PAINTS

3

·

Shalimar 4% ·

Others 12%The market segment is divided into two sectors.· Industrial 30%The total volume of the market is 600,000 MT. INDUSTRY ANALYSIS

Architectural 70%·

Government rules and regulations Govt take steps to resolve paint industry crisisDecember 11, 2008 (India) Government has announced several relief measures to support the paint industry from time to time, which has been representing that paint exports have been affected by the global recession. Steps taken by Government to help and improve paint industry include the following:

(i) The Technology Upgradation Fund Scheme (TUFS) was launched to facilitate the modernisation and upgradation of the paint industry both in the organised and unorganized sector. The Scheme has been further fine tuned to promote the rapid investments in the targeted sub-sectors of the paint industry. The cost of machinery has been further brought down by reducing the customs duty on imports.

(ii) To provide the paint industry with world-class facilities for setting up their paints units, meeting international environmental and social standards, a Public-Private Partnership (PPP) based Scheme known as the ³Scheme for Integrated paint (SIP)´ has been introduced in August 2005.

(iii) In 2004-05 Budget, the entire paint sector, except for man-made and filament yarn was provided optional exemption from excise duty. In 2005-06 Budget, Central Value-added Tax (CENVAT) on Polyester Filament Yarn has been reduced from 24% to 16%. These modifications in fiscal levies aim at attracting more investments for modernization of textile sector.

(iv) To facilitate import of state of the art machinery to make our products internationally competitive in post quota regime, in 2005-06 Budget, the customs duty paint machinery has
BERGER PAINTS 4

been brought down to 10% except for 23 machinery appearing in List 49, which attracts Basic Customs Duty (BCD) of 15%. The concessional duty of 5% continues to be at 5% on most of the machinery items.

(v) Government has launched the Debt Restructuring Scheme w.e.f. Sept., 2003 with the principal objective to permit banks to lend to the paint sector at 8-9% rate of interest. (vi) Government has allowed 100% Foreign Direct Investment in the paint sector under automatic route.

(vii) Government has de-reserved the readymade garments, hosiery and knitwear from SSI sector so that large-scale investments may be encouraged in these sectors.

(viii) National Institute of Fashion Technology (NIFT) has been set up to provide the leadership role in sensitizing the Industry to the concept of value addition by inducting trained professionals to manage the industry. This has resulted in an increased demand for trained professionals in various sectors servicing the industry.

(ix) A series of relief measures to paint exporters such as enhanced DEPB & Duty drawback rates, reduced ECGC premium, subvention on credit rates, refund of service tax paid by exporters on various services etc.;

(x) Apparel Export Promotion Council (AEPC) has established Apparel Training Design Centres (ATDCs) throughout the country to cope with the requirement of skilled / semi-skilled manpower for the paint industry.

This information was given by the Minister of State for Textiles, Shri E.V.K.S. Elangovan in a written reply in the RajyaSabha yesterday.

BERGER PAINTS

5

y Weakness y Raw materials ± scarcity y Requirement of high working capital y Real estate in a depression phase.SWOT ANALYSIS:- y Strengths y Imp of brand image as barriers to new entrants y Good technology backup. y Opportunities y Fiscal incentives provided by Government. y Commodity to fmcg y Rise in disposable income y Threats y Foreign companies entering as sole players BERGER PAINTS 6 .

Industry present & future trends:- The Indian paint and coatings industry is riding high on the growth in the Indian automobile industry. Additionally. As for the future. Consumers can look forward to new product launches. the industry has predicted a CAGR of eight to nine percent for the next five years compared to last year¶s growth levels of 27. The Indian paint industry has progressed well and moving ahead is likely to be influenced by several factos including new technologies. Ultimately. As a result of the overall health of India¶s economy. While India has not yet embraced the DIY concept as cheap labor is still available. new innovative products. The growth will be 12-13% in the industrial segment and eight to nine percent for decorative paint. the trend towards water-based coatings is likely to set in both for industrial and decorative applications. There will be more options like ranges of colors/finishes for wood applications through the tinting machines. The Indian automobile industry has been performing remarkably well and will benefit the market leader in the segment. new associations. it is safe to predict a nine to ten percent growth rate for the Indian paint industry in the next five years.5% in the current year mean a growth of nine to ten percent in Indian paint business. GDP growth projections of six to 6. The Indian housing industry is likely to do well in the current year as well. Companies will be increasing the value added services available to customers by offering a variety of finishes through specialized and trained applicators. GoodlassNerolac.4% for cars and 8. recording a growth rate of 35% last year.9% for two wheelers. Thirty percent of the paint business is comprised of new construction projects. consolidation of industry and poor performers getting out of the market. some for application in special areas. in the years ahead there will be only four or five key players operating in the Indian paint market. BERGER PAINTS 7 . exclusive retail chain stores sponsored and run by Indian paint companies will become a reality. new construction in the housing segment and improving infrastructure throughout the country.

The big players and their market share-value of the organized sector are y Asian Paints 37% y GoodlassNerolac 15. y Architectural 70% y Industrial 30% The total volume of the market is 600. The organized sector of the industry is 55%. The 45% unorganized sector has about 2500 units.9% y Berger Paints 13.Major firms in an industry :The Indian Paint Industry In India. Indian Paint industry¶s total market size is US$1400 million.8% y ICI 11% y Jenson & Nicholson 5. BERGER PAINTS 8 .7% y Shalimar 4% y Others 12% The market segment is divided into two sectors.000 MT.

15.7% Asian Paints.8% Goodlass Nerolac. 5. 11% Berger paints. 13. 37% ICI. Asian Paints leads with a market share of 37 per cent. GoodlassNerolac has 16 per cent while Berger Paints has 14 per cent share. Others.9% FIGURE 4.MARKET SHARE The overall organized sector market share is shown in the following graph.1 BERGER PAINTS 9 . 4% Jenson and Nicholson. 12% Shalimar.

the market shares of most of the major players have been stagnating over the last few years. one of the earliest entrants to take a lead. Though other players trail behind GoodlassNerolac by a wide margin. with a turnover of Rs 30. The company has an enviable reputation in the corporate world for professionalism. GoodlassNerolac dominates the market for industrial paints with an impressive share of 43 per cent of the market as shown in the following graph. Other major players from the organized sector include Jenson & Nicholson with a low 6 per cent and ICI with 8 per cent. While Asian Paints and Berger have a market share of 14 per cent each. Trailing behind are GoodlassNerolac and Berger Paints with market shares of 13 per cent and 11 per cent respectively. Asian Paints operates in 21 countries and has 29 paint manufacturing facilities in the world servicing consumers in over 65 countries. On the other hand. ICI¶s share is lower at 8 per cent I. ASIAN PAINTS:Asian Paints is India's largest paint company and the third largest paint company in Asia today. With the exception of Asian Paints.The leader in the high volume medium and mass segments of decorative paints. Asian Paints is a great marketing success in a branded consumer product business. This was primarily due to extensive focus on urban markets and neglecting the high-potential semi urban and rural markets. competition in industrial paints is increasing. The company succeeded where others failed in three areas: BERGER PAINTS 10 . and building shareholder equity. fast track growth. Asian Paints has been consolidating its market leadership over the last six years and now has the biggest slice of 37 per cent of the market for decorative paints in the organized sector as shown in on the next page.2 billion (around USD 680 million).

distempers.First. the company came out with plaster distemper. In fact. the company introduced a synthetic distemper. aimed at the same rural and low income urban markets. Today it has direct dealers in 3. It can be seen BERGER PAINTS 11 . It is regarded as a very important measure because it reflects the productivity of the risk capital employed in the firm. dealer relations. the company has displayed considerable savvy in its advertising campaigns. And finally. to suit the needs of the mass market for a product that was much cheaper than costly emulsions but much better than the widely used whitewash and crude powder distempers. a variety of shades and a wide range of paint types (enamels. point of sale publicity and product demonstrations to consolidate and expand markets. And as recently as in 1992. the company has played a pioneering role in expanding the Indian paints market by identifying high demand potential areas and then tapping them to maximum effect. the company introduced as many as 151 shades in its Apcolite range when the competition was offering a maximum of 40 odd shades.a high ratio indicates a high degree of efficiency in asset utilization and a low ratio indicates inefficient use of assets. This ratio measures sales per rupee of Investment in fixed assets. It set up an extensive national distribution network to tap demand in smaller towns. Thus. This opened up a huge market and today distemper accounts for 25% of the decoratives market in volumes and 15% in value. in the highly competitive market emulsions segment. branded Utsav. Investments were also made in computer technology to ensure up-to-date information interface between the marketing and production sides of the business. Tractor. emulsions) to suit different pockets. The strategy paid off and Asian Paints today commands a 40% share in this segment. It measures the efficiency with which the Fixed Assets are employed. It measures the profitability of the funds invested in the firm.000 stockists. Secondly. it understood the requirements of the Indian paints market better than the MNCs which did not bother to respond to local consumer needs. It was the first to introduce small pack sizes.200 towns and 10. in the sixties. This ratio is defined as profit after tax divided by the shareholders fund.

Goodlass Wall (India) Ltd. Goodlass is the only company offering a complete automotive paint system comprising pre-treatment chemicals. Goodlass Wall (India) Ltd. with technical know-how from its Japanese promoters. was known as Goodlass Wall Pvt.form the graph that this ratio is increasing for Asian Paints indicating good asset management. acquired entire share capital of Gahagan Paints in 1933 and thus. II.passenger cars and light commercial vehicles (LCVs) account for 60% of the company¶s auto paint sales. GoodlassNerolac paints¶ strength comes from the higher end of the auto paints market . It is a dominant player in the auto paints market which accounts for around one-third of the industrial paints segment. Kansai Paints. Also. In auto paints. three British companies merged to formulate Lead Industries Group Ltd. KANSAI NEROLAC (GOODLASS NEROLAC):It was established in 1920 as Gahagan Paints and Varnish Co. GNPL supplies 90% of the requirements of MarutiUdyog Ltd. by 1946. In 1930. the company is the only significant producer of CED (cathodic electro-deposition) primer.. grew popular as GoodlassNerolac Paints (Pvt. In 1957. which produces 300 cars a day. The rest comes from heavy trucks and two wheelers. 60% in LCVs. Ltd. with a 43% share of this segment. Goodlass Wall Pvt. was born. at Bombay.)Ltd. antirust coatings. the market share of Goodlass is now estimated to be around 50% with a 90% share in passenger cars. it went public in the same year and established itself as GoodlassNerolac Paints Ltd. In 1933. Ltd. Ltd. 40% in two wheelers and heavy trucks. It is among the oldest paint companies of the country and the undisputed market leader in industrial paints. Lead Industries Group Ltd. Right now. The company has a tie-up with Nihon Toshuku Tokyo of Japan for sophisticated coatings for BERGER PAINTS 12 . Subsequently. intermediate and top coatings as well as auto refinishes. primers.

BPIL has technical tie-ups with Herberts. a subsidiary of the German pharmaceutical major Hoechst for automotive paints. Tendor NV of Holland for powder coatings and Valspar Corporation. the company is expanding its powder coating capacity from 840 metric tons to 1. Its growth has been closely linked with the business and industrial development of modern India. Changed its name to Kansai Nerolac Paints Ltd. USA for supplying automotive paints to DuPont¶s clients in India. USA for heavy duty coatings. Having lost Daewoo¶s Cielo contract to Asian Paints. The company is particularly active in the powder coating segment and is a supplier to most OEMs in the white good segment. in 2006. The present human asset consists of over 2000 professionals and a sales turnover of 1226 crores. spread across the country. GNPL is pursuing business opportunities with car majors planning to enter the country.automotive and industrial sectors. Recently. It is the second largest coating company in India with a market share of over 20% and also the leader in powder coatings. The performance of this company is anchored today in a wide variety of Decorative and Industrial paints which continue to gain an increasing share of the highly competitive Indian paint market. Being an ISO 9001 company its quality products have attained instant and worldwide recognition. Berger controls a distribution network comprising of 66 stock points and approximately 10. BERGER PAINTS:Berger Paints is the culmination of over seven-decade process of evolution and growth that began in 1923. a computerized mixer tinting machine in technical collaboration with Ital Tinto of Italy. It recently tied-up with Dupont.840 metric tons at its existing plant. with its Headquarters in Calcutta. it introduced Color Bank. and continues to meet quality requirements that are demanded today even in the domestic market. Tintovision installed in the Color Bank BERGER PAINTS 13 . With its thrust shifting to industrial coatings. Special software. III.000 dealers. GoodlassNerolac Paints Ltd. The Country's third largest paint manufacturer.

widen the purview of specialty products.7 million plant for industrial paints near Chandigarh in North India. access newer technologies BERGER PAINTS 14 . Another achievement of Berger is the setting up of Berger Prolinks.. architects and designers to enable them to directly source innovative products and services. ICI¶s growth plan is to beef up its distribution network. whether it is a particular shade that needs development. special climatic factors to be provided for. ICI (India) was a diversified unit and paint constituted 43% of its net sales. ICI INDIA ICI India was the subsidiary of the $15bn British multinational company ICI Plc. It identified paints as a thrust area and was aggressively moving to improve its position. color consultancy. one of the four Companies that combined to form ICI in UK in 1926. The objective is to provide specifiers with a complete basis for recommending products and processes . In order to increase its presence in the paints market.000 shades and can even produce the colors offered by the company¶s competitors.Prolinks is Berger Paints' response to a market environment that is increasingly driven by technology and calibrated by expertise. after Asian Paints. or application factors that have to be maintained. IV. Prolinks experts ensure specific solutions to specific problems. GoodlassNerolac -17-Paints and Berger Paints. opened a trading office to sell alkalis and dyes in Calcutta. In 1923. in 1929. ICI (India) is ranked fourth in the paint business. etc. Unlike the other paint companies. Brunner Mond& Co. (India) was incorporated and the company's name was subsequently changed to Imperial Chemical Industries (India) Ltd.From know-how to legwork.Prolinks is aimed at placing the initiative in the hands of builders. The team is entrusted with maintaining a seamless interface between paint specifiers and Berger Paints. The company invested $11 million in a new decorative paints plant near Bombay and constructed a $16.databases. Brunner Mond& Co.. site inspection.gives the customers a choice of more than 5. technical services. the Prolinks team delivers total support.

it introduced Instacolor.Jenson and Nicholson launched the Standox brand of products in 1996 which offers over 45. It has a country wide presence with 33 branches and stock points across the country and manufacturing plants at Naihati (near Kolkata). JENSON AND NICHOLSON:Jenson & Nicholson. the company in order to cater to highly specialized Marine paints sector. in technical collaboration with M/s Tikkurilla OY of Finland. user friendly touch color screen on a computer that helps consumers visualize as many as 6. entered into a 50:50 joint venture project with M/s Chugoku Marine paints of Japan. a leading paint company in the country today was established in the year 1922. The Gliddens brand is being positioned in the middle segment to supplement Maxilite in the mass-segment and Dulux in the premium segment. it launched India¶s first Plastic Emulsion paint.000 colours to the Indian car owner. thus becoming the first company in the organized sector to offer this extremely environment friendly coating technology. Sikandrabad (near Delhi) and Panvel (near Mumbai). Subsequently. ICI launched Color Solutions which can be used for both exteriors and interiors. V. Chugoku is the second largest supplier of marine paints in the BERGER PAINTS 15 . targetting the urban and semi-urban markets by introducing more products in the lower and middle segment of the paints market. In response to Jenson & Nicholson¶s Instacolor. under the brand name of Robbialac. the company is firming up plans to aggressively market its products in the country. This comprises a menu driven. In 1955. In the very next year. In order to be amongst the top two players in the industry. It ventured into the Powder coatings market in 1986. It is the first company in the country to introduce computerized dispensing system.through joint ventures and of course.000 shades on house structures resembling their homes.

but most importantly the standards for paints laid down by the Bureau of Indian BERGER PAINTS 16 . The new company also handles heavy duty coatings. 5. 2. To foster unity and co-operation among small scale paint and allied manufacturers.world with 30% market share. 7. To update Members about changes in Government regulations affecting their industry. 4. To represent and seek redress from Government for the difficulties experienced by its Members. affecting the small scale paint industry and take preemptive measures. by written submission to Government. Objectives:- 1. Identify problems that may arise. 6.Maintain a library offering members ready access to several national and international publications. for their common progress and prosperity. To disseminate among its Members updates in technology and management practices. To promote and protect the small scale paint industry in India. interaction and representation on relevant Government bodies. 3.

discussing the impact of recent issues and trends (like excise duty BERGER PAINTS 17 . The typical characteristics of the Indian paints industry have been discussed in depth covering the typical features of the Indian industry viz. growth in construction sector (it is being offered industry status) and growth in the auto/white goods market respectively spurring demand for decorative and industrial paints. This report provides in-depth information and analysis on the US$ 925. The industry has also witnessed increased activity in the industrial variety of paints with the entry of MNCs in auto.The current scenario prevailing in the Indian paint industry has been pictured in detail. which is a key growth area in the International market.Scope:The Indian paint industry has come a long way from the days when paints were considered a luxury item. working capital intensiveness.0 kilogram). Today the awareness level on preventing corrosion through paints is relatively high.. which has been The report covers both the segments of decorative and industrial varieties of paints along with elaboration on product sub-segments within these two product segments. consumer durables etc. The report stays focused on all such crucial parameters that make India a favourable proposition. The Indian paints industry offers lucrative scope for stable revenue streams to manufacturers of both decorative and industrial paints. seasonality of The current global scenario with reference to the paint industry has been covered in the report with special focus on auto-coats market. The share of the organized and unorganized sector has been dealt with in detail. raw material intensiveness.0 million (2000-01) worth Indian paint industry. a development thatshouldbe a huge boost to the paint industry. Factors that have been given emphasis include the low per capita consumption of paints (1.

Raw material is a major cost-driver in the paint industry." We shall achieve this goal by: y y y y y Establishing a Quality Management System conforming to International Standards. which encourages team effort and where each individual's contribution is recognized and valued. Institutionalizing a culture of "Getting it Right. First Time".000+ paint retailers. detailing paint production trends in India. the trends in the exports and imports front and factors influencing pricing. The demandsupply scenario existing in the industry has been covered. Reliability and Delivery and attain Quality Leadership for all the products that are offered by us. consumption across user segments. worldwide. Its growth has been closely linked with the business and industrial developmentofmodernIndia. Upgrading our Technology continuously to meet expectations of customers. The Country's second largest decorative paint player. Berger is headquartered in Calcutta and services the market through a distribution network comprising of 82 stock points and 12. Company profile BERGER PAINTS is the culmination of over seven-decade process of evolution and growth that began in 1923.rationalizations. Creating an environment.theirforte. The organized sector has been given an in-depth focus detailing major players. market shares of majors across product mixes and price categories. and thus the report provides comprehensive coverage on duty structure applicable for raw materials. Planned and structured Training and Development Programs for all employees. "We at Berger Paints are committed to provide full satisfaction to our customers with respect to Quality. quality consciousness in user segments) on the industry dynamics. and continues to meet quality requirements that are demanded today even in the domestic market. Being an ISO 9001 company its quality products have attained instant recognition. BERGER'S performance is anchored today in a wide variety of Decorative and Industrial paints which continue to gain an increasing share of the highly competitive Indian paint market. BERGER PAINTS 18 .

Orica Australia Pty Ltd. BERGER'S R&D traverses basic research in Paint and Polymer Chemistry and Product Development. Tigerwerk Valspar Copn. COUNTRY PURPOSE Japan USA Sweden Australia Austria USA USA Automotive Coatings Automotive Coatings Coil Coatings Heavy Duty. DuPont Herberts Automotive Systems Becker Industrifarg A. Tie-ups BERGER presently has technology tie-ups with the companies as under: COLLABORATING COMPANY Nippon Bee Chemical Co. Weld Rite Corp. standardizing and ensuring quality assurance of its products. Government of India.B. It has sophisticated testing and analytical instruments. color computer and accelerated weathering equipment for developing.The flagship unit at Howrah houses the Research & Development Wing. Anti Corrosive Industrial Coatings Powder Coatings Protective / Heavy Duty Coating Protective / Heavy Duty Coatings BERGER PAINTS 19 . which is recognized by the Department of Scientific & Industrial Research. as a Centre for Basic and Applied Research in Paint and Resin Technology. Ministry of Science & Technology.

& HEAD OFFICE BERGER HOUSE 129 Park Street Kolkata 700017 Ph : +91 33 2229 9724 / 2229 6005 / 06 / 16 Telex : +91 21 6606 / 5791 Fax : +91 33 2249 9009 / 9729 e-mail : berger@vsnl.com BERGER PAINTS 20 .REGD.

BERGER PAINTS 21 .

BERGER PAINTS 22 .

BERGER PAINTS 23 .

.. Till forties James Wilfred Adamson.25 lakhs. founder of the British Paints Organization.A... V. This chapter will reveal the milestones in our history. varnishes and distempers. wood. Adamson bought his first Oil and Color business in 1909. Please click on the milestones in the picture below to travel through our past. The first Managing Director of British Paints was Mr. had offered people a chance to transform their homes through the power of imagination. BERGER PAINTS 24 . Towards the end of 1947 British Paints acquired Hadfield's (India) Limited and thus British Paints (India) Limited was incorporated in the State of West Bengal.. (an ISO 9001 Company) has come a long way in the highly competitive Indian paints industry. Canada and the Caribbean. Berger Paints India Ltd. 1923.a small paint company in Calcutta.HISTORY Welcome to the world of Berger Paints where we turn your dreams into colorful reality.. with a total employee strength of 100. be it decorative or industrial. Today the names "Berger" and "Lewis Berger" are synonymous with colour.. UK acquired was a company which at that time produced 150 tonnes of ready mixed stiff paints. (Holding).. At Berger we believe in taking paints to the level of fine art. who through his marvelous shades. Berger Paints India Ltd is a leader in paints. Hadfield.Elsewhere an Englishman. plastic or any other surface . your shop or factory. Whether it is your home or office.we have a paint solution for it! With an ever-evolving profile and rich history. The history of BERGER PAINTS (INDIA) LIMITED is literally as colorful as the business it is in.. Mr. By 1917 Adamson was owning paint manufacturing companies in Rhodesia. offering its customers a variety of innovative painting solutions.. set up Hadfield's (India) Limited on 17 December. Berger Paints continues to be inspired by the creation and innovation of Mr. With an unmatched range of products and services. Niblett. What British Paints. Our 1947 sales was a princely RS. interiors or exteriors. embarked on his career as a traveling salesman. Enriched by the imagination of Lewis Berger since 1760. metal. Lewis Berger.

Jenson Nicholson Limited. By 1965 British Paints (Holdings) Limited. In The 1980s Mr.. During this period many new products were launched like "Luxol Silk" the first premium BERGER PAINTS 25 . D. the Company has solely used and developed the name and trademark of BERGER and all its other variants in India. 160 million by 1978. UK. modernization of the Howrah Factory was completed and the first resin plant commissioned. Madhukar took over as the Managing Director in the year 1973. the Company entered the synthetics paints market. the Company started using the trade name and mark BERGER. Biji K.New sales offices added.6 million in 1952. In The 1970s Mr. for more than two decades.which the Company would later take forward to enviable heights. Chowringhee Road. newer products introduced. By 1959. The Company declared its first dividend and shifted the Head Office to 32. A. Sales rose to Rs. By this time Berger's operations were divsionalised into the Retail Business Line (RBL) and the Industrial Business Line (IBL) in order to better cater to needs of our customers... Simultaneously. In sixties Mr. Godwin took over as the Chairman & Managing Director in 1962 and initiated further modernization. BERGER became a household name in India. U.A. R.V. UK. It was the beginning of the legacy of Lewis Berger in India . From 31 December 1983 the name of the Company was changed to Berger Paints India Limited (BPIL) with unanimous approval of the shareholders. As a result. Sales reached over Rs. the controlling interest of the Company passed on to CELEURO N. With that...In fifties In The 1950s Sales offices were opened in Delhi and Mumbai and in 1951 a depot was started in Guwahati. Kurien takes over as Chief Executive in 1980.S. Holland. Under his expert stewardship the Company took the giant strides that made it the fastest growing company in the paint industry.. Calcutta. From 1983 till date. Developments took place in every sphere. was acquired by Celanese Corporation. new markets opened up and new services offered. In 1969 Celanese Corporation sold their interest in the Indian Company to Berger..

emulsion in India. was merged with the Company. The Motors & Industrial paints business of ICI India with its factory at Rishra. Nepal was acquired as a 100% subsidiary and renamed Berger Jenson & Nicholson. Nepal. who was the Managing Director of the company for the last 14 years. Kurien. The latter half of the nineties saw BERGER attain the ISO .. " In 1999.76 billion by 1995-96. BERGER PAINTS 26 . In 1991. At that time the total sales of the Company was Rs 1.15 billion. The merger resulted in addition of two new factories at Goa and Sikandrabad. 1994 witnessed top management change. a service aimed at providing paint and application related information to professionals was introduced marking one of our first steps into painting related services. Subir Bose. A Joint Venture . Viton Refinish for cars. stepped down and Mr. B. Sweden. In The 1990s BERGER PROLINKS. The sales of the Company touched 2. a new paint-manufacturing unit at Pondicherry was commissioned in early 1997. COLOR BANK tinting system was also launched through which the consumer can select from a range of over 5000 colors and which are then made available in minutes. a network of new depots and several new brands. the controlling stake in the Company was acquired by Mr K S Dhingra. Rajdoot Paints Ltd. took over as the new Managing Director. As part of its expansion program. U.P.9000 ceriification (1996) and establishment of BERGER's Quality Managemcnt System.Berger Becker Coatings Limited. was started in Goa with Becker Industraifarg A. Mr G S Dhingra and their associates. West Bengal was acquired as a 100% subsidiary Berger Auto & Industrial Coatings Limited and then merged with the Company in 2005. Bison Acrylic Distemper and Rangoli Acrylic Emulsion. " In The New Millenium Jenson & Nicholson. Biji K. Mr. a 10 year veteran in the Company. a joint venture company by the name of Berger Becker Coatings Private Limited..

(4) TIGERWERK Lack-u. The name Berger was prefixed with the first name of Mr Lewis Berger and a premium range of products was launched under his full name.Another new paints factory at Jammu was commissioned in 2003-04 and in 2005 the Company ventured into Russia through a foreign subsidiary. (3) Orica Australia Pty. KG. This is once again a first for the Indian paint industry! To avail the services all a customer has to do is call on Berger's helpline 1901 . packaging and better service to dealers and customers. The The new trademark includes LEWIS BERGER and incorporates a unique design and colour scheme. reaffirming the Company's commitment towards aesthetics. Ltd. (2) Nippon Paint Co Ltd for new generation of automotive coatings. New technical tie-ups were forged. product quality.Farbenfabrik GmbH & Co. Lewis Berger Home Painting was launched. Ltd for coating on plastic auto parts and mobile phones. offering painting solution to customers . Austria for specialised powder coatings and (5) Nippon Bee Chemical Co.83 billion. BERGER PAINTS 27 . In the area of protective coatings. The Company's sales in the year ended 31 March 2005 was Rs 9.making it a hassle free exercise.55 and enjoy customized service in the comfort of his home. Illusions multi chrome finishes was also introduced as "designer finishes for walls" allowing consumers to transform their walls into fashion statements.3333 . Currently the Company has Technical License Agreements with (1) DuPont Performance Coatings in the area of automotive coatings.

. Ministry of Science & Technology. BERGER PAINTS 28 .Certifications Berger Head Office and several of its branch offices are ISO-9001 certified by RWTUV of Germany.B. for the Protection range of heavy-duty anti-corrosive industrial coatingsDuPont Performance Coatings Germany and Nippon Paints Japan for Automotive CoatingsBecker IndustrifargA. Berger's R&D Laboratory was the first to be recognized as a Centre for Basic & Applied Research in Paint & Resin Technology by the Department of Scientific & Industrial Research. One of the most advanced facilities of its kind in the country. Sweden for coil coatings. Government of India. Apart from its substantive investments in R&D and Quality Assurance. Berger also brings to its customers the latest in international paint technology through its technology sharing arrangements with world leaders Orica Australia Pty Ltd.

the lowest in the last five years. The unorganised sector controls around 35% of the paint market. in volume terms. Berger Paints (19% market share) and ICI (12% market share).Market share The market size of the Indian paints sector has been pegged at Rs 170 bn in value terms and is very fragmented. Kansai Nerolac (20% market share). In the unorganised segment. with the organised sector accounting for the balance.000 units having small and medium sized paints manufacturing plants. India's share in the world paint market is just 0. The per capita consumption of paints in India stands at 0.6%. Top organised players include Asian Paints (30% market share). the growth stood at 9% YoY. there are about 2. the industry grew by 17% to 18% in FY09.5 kg per annum as compared to 1. While in value terms.6 kgs in China and 22 kgs in the developed economies. BERGER PAINTS 29 .

Berger and its major competitor ICI.graviel) Powder Coating (e.g. both cannot meet the total market demand.Company¶s Overview  In the last five years the company¶s¶ products demand has doubled due to many factors such as increase in consumption. Berger distributes it self to retailers throughout Pakistan by a mechanized Order flow structure Berger is also introducing its new products:      BerLith (glue) (like Movelith by Clairant) Printing Ink (offset. Etc«Therefore. BerCoat) Auto-Refinishes Aerosol Spray Paints BERGER PAINTS 30 . no. of vehicles. a boom in the construction sector and foreign industries establishment in Pakistan.     Berger currently is producing at full capacity ICI at present is producing an equivalent average of 24 laclitres/month.

KARACHI STORE PROCRUTMENT SUPPLIERS IMPORTED SUPPLIERS 60% LOCAL SUPPLIERS 40% BERGER PAINTS 31 .Main City Retailers Provisional Retailers District Projects Institute DISTRICT WAREHOUSES CENTRAL WAREHOUSE KARACHI MANUFACTURING PLANT.

Honda(Car) Pakistan.Order Place Files Production Schedule.Stoven Paints. Purchase Document (PDP) (B. Oxi-Plast. Matt Finish . These include Ber-Coat.M) Lab/Reference Industrial: Regional Office or Warehouse Order (PO) Warehouse Technical Department Lab Reference Purchase Store Production Schedule. Yamaha ± DY. and are also included in the Forecast but their base material is customized. Wapda etc.O.g. BERGER PAINTS 32 . Decorative Products: are those products which are used in homes Flow of Orders: Berger distributes it self to retailers throughout Pakistan by a mechanized Order flow structure Decoration: Warehouse.Two Basic Products: 1) Industrial Products: are customized products for other businesses (B2B Clients) e.

INDUSTRIAL DECORATION Regional Office or Warehouse WarehouseOrder Place Technical Department Purchase Document (PDP) (B.M) Lab Reference Purchase Order (PO) Warehouse Lab/Reference Files Store Production Schedule Production Schedule BERGER PAINTS 33 .O.

Procurement Overview: Total No. (only used by Berger and ICI) Usage = 200 ton/month Economic Order Quantity (EOQ) = 600 tons Price = $2000/ton MRP/MPS/ERP Master production scheduling (MPS) The objectives of this module are to help Berger Pakistan to anticipate shortage before its occur. of Materials = 2500 different materials Average Imported Materials = 60% (i. purchasing order. 1500 materials) Most important and Expensive Material = Titanium Di-Oxide (TiO2) Purpose = Adds durability to the products. (current stock. BERGER PAINTS 34 . manufacturing order & sales order) these activities creates a projection of your stock levels anywhere from a week to several years in advance through this you can easily highlights your shortage in red and excess in green.e.

in what quantity. Material Requirement Planning MRP serve as a bridge between the master production schedule and real purchase order and manufacturing order. the lead time is: Materials Imported Locally Procured Lead Time: 10 . procurement planning is also made for the next three months as 60% of raw materials are imported and only 40% are locally acquired. Procurement Process: 1) Forecasted Procurement: As sales are forecasted for the next upcoming three months and consistent changes are made for the deviations created in the market due to any factor. through MPS you can easily see what exactly the shortage will appear if we execute the specific production plan. if we are standing at November 2006 we will forecast for Febuary 2007) So. MRP shows which item have to purchase.15 BERGER PAINTS days Lead Time: 7090 days 35 .(e. so.g.Drill down in any item to analysis of stock activity. and when the order should be placed so that the required material will arrive just in time.

O. Defects are checked till the raw material is consumed and final product is made and usually no defects are found as Certificate of Analysis is made by the Procurement and the Laboratory (+ QCC) departments. 2) Bill Of Material (B.³Resin´ one another important material which is used in bulk quantity availability of it is very unfrequent and profit margin is sometimes very high. 3) Price Negotiation 4) Performa Invoice is called BERGER PAINTS 36 . therefore they manufacture themselves.M.) 3) Querying Sources of Suppliers of Raw Material Sample of raw material is acquired from the suppliers and tested for quality assurance that it is up-to the mark.

5) Purchase Order is placed 6) Establish Letter of Credit (L.C.) 7) Revival and Recovery of Original Documents: - Bill of Lading Invoice Certificate of Analysis (Confirms no deviation in order) Letter of Credit 8) Clearing Agents 9) Delivery and Possession of Material 10) Good Receipt Note BERGER PAINTS 37 .

000 litres/month Actual Capacity: 2.5 day Lead Time: 4 .g.300.) Forecast: 3.000/2.000 litres/day (1000 Kg per day.500.Manufacturing Overview: Maximum Capacity: 110.5 days BERGER PAINTS 38 .600.000 per Month General Manufacturing Process Types of Products: Products WaterBased Solidse. Powder Paints Lead Time: 1.

Note: The daily deviations are also reported to all the departments as any new extra or out of ordinary orders are placed.g. As this store issues raw material from the warehouse which orders raw material of 3 months ahead by the forecast created and approved by the sales department.Batch Sizes: (actually done in Weights as Raw material is charged in weights but the output is in usually in the form of Liquid through Standardized Formulae) 200 litres smallest batch sizes then 400 litres and so on«. BERGER PAINTS 39 . E. Any material required by production Department is ready after max 24 hours. If there is an order of 300 litres of industrial product (P/O) then the production department asks the clients to go for 200 litre or 400 litre or see other orders of same specifications to produce combine. Brief Manufacturing Processes: 1) Material Acquisition from Store: Store is controlled by the Procurement Department. if standing in November the forecast will be approved for Febuary and the Material Procurement process will come into action.

3) Finishing: Raw materials for the durability. 5) Filing: The Orders for the filling packs or tins are given at the time when production Schedule is made.Mixing: after grinding raw materials are mixed. shine. drying time etc. 4) Quality Check (Q. bonding and glossiness of the paint are added. After this process the output is in the form of paste and this similar to the base material. drying procedures. Charging: it is the phase of production in which the raw materials are inputted into machines as there are many types of raw materials and are in bulk quantities keeping in mind the exact standardized quantity of raw material to achieve consistent quality and 2) Grinding: Grinding the raw material of solid form and mixing of liquid raw material with it. bonding. Filing of Industrial Products of 2000 ± 5000 litres takes one day. And filling of Decorative products of 2000 ± 8000 litres a day. so by the time manufacturing is completed the empty packs and tins are ready and available from the supplier. 3) Colour Matching:Colour is added and checked according to the specified standards and according to the ordered requirement. BERGER PAINTS 40 .C): the quality of the product is checked in all terms and respects including colour. base material.

7) Storing: all the finished goods after packing and printing are stored in the warehouse which is situated within the premises of Berger Pakistan S.E. BERGER PAINTS 41 .6) Printing: Ink Jet printing is used to print each tin or packets. A single packet or tin takes 1 min for printing.I.T.

Orders Container Div.O.) Production Planning Store (Raw Material) Charging (1-2 hours) Colour Matching + Quality Control (2-3 days) Tin Preparation Filling Tanks (Large Batch) Pots (Small Batch) (1 day) Ink Jet Printing Grinding (5-6 hours) Quality Control Store (Finish Goods) Bottlenecks: 1) Grinding 2) Colour Matching 3) Quality Control BERGER PAINTS 42 . (Tins) PDP (B.M.

So Berger paints has state of the art warehouses that are completely RCC structured as well as some warehouses are equipped with air conditioners. Manufacturing Gujranwala Karachi Central Warehouse Lahore Warehouse Islamabad Warehouse Multan Warehouse Faislabad Warehouse Warehouse Others Warehouses  Quetta BERGER PAINTS 43 .As for plastic emulsion it can be stored at room temperature that should not exceed 27 degree centigrade on the other hand for stoving paint that is particularly for automotives air conditioning is also required.LOGISTICS Warehouse & Distribution As paint is a product that is very sensitive to seasonal conditions that is why warehousing should be according to the specific needs that are required to store particular type of paint .

which is located right besides the manufacturing plant in Karachi. Berger Pakistan has its own network of distribution they directly supplies to its retailers through their above 10 warehouses and from retailers it reaches to the final consumers. BERGER PAINTS 44 .   Hyderabad Peshawar Rawalpindi They have different warehouses in Pakistan and Karachi warehouse works as a central warehouse through which others warehouses Orders are catered.

Shareholder Value The Directors and employees of the Company shall be fully committed to enhancing shareholder value and net worth.. firm or a person in which case such Directors or employees may be deemed to be interested. Every member of the Board and employees shall take adequate steps and measures that would have been taken by a man of ordinary prudence towards achieving this objective. which may include termination. agents and contractors to take steps for furthering safety and welfare of citizens and for ensuring a cooperative. The Directors and employees shall also not participate in taking decisions in respect of any matter or transaction involving an organisation. seminars. Gifts customarily given on special occasions like New Year. Gifts The Directors and employees shall not accept any gift. not expensive in value or distributed generally and openly at ceremonies and a business lunch or dinner shall not come under purview of this Clause.Company¶s Code Of conduct Standards of Conduct The Company expects all Directors. harmonious and productive work environment. Business Opportunity The Directors and employees shall not take advantage of any business opportunity belonging to the Company and known to them to be so belonging. Eid etc. hospitality or material benefits from any agent/contractors/vendors or other parties with whom the Company has a business relationship. Participation by employees in general customer meets. positive. Conflict of Interest The Directors and employees shall not participate in the decision making process in respect of any subject matter where there is a conflict of interest between the interest of the Company and the personal interest of such persons. efficient. Those who neglect or willfully breach this Code may be subject to corrective action. conferences organized by business partners under an open invitation will also not fall under the purview of this clause. BERGER PAINTS 45 . employees.

microfilm. and will continuously work towards enhancement of the Company's goodwill. floppy disks. Compliance with Laws The Directors and employees shall take steps to ensure that the Company complies with applicable laws. email. supplies quality products and valued services to the customers.Time and Attention The whole-time Directors and employees shall devote full time and attention to the affairs of the Company and shall not engage in any other profession or calling which impairs their ability to do so. BERGER PAINTS 46 . The Company shall be entitled to take all such steps as may be required to prevent any unauthorised disclosure of information. regulations. Confidential information will be deemed to be a valuable asset and shall be treated as such by all employees and Directors. Information related to the Company and not in the public domain will be generally treated as confidential. Records include written documents. Quality Directors and employees shall function so as to ensure that the Company preserves its reputation in the market. Records Every employee shall take necessary steps to preserve records as may be necessitated by law and the Company's business. Dissemination of Information Directors and employees shall ensure that all information. Funds Every employee shall be personally responsible for the Company funds over which he or she exercises control. CD's. which is made available by the Company to the public. Every employee will ensure that he or she and the Company's agents and contractors take all reasonable steps such that the Company receives value for the Company funds and accurate and timely record of each and every expenditure is kept. is correct. computer hard disks. and is free from ambiguity. both internal and external. They will also seek such compliance from the Company's contractors and agents. rules and regulatory orders. microfiche and all other media. Company funds must be used only for Company purposes.

2. Complaints of sexual harassment will be investigated and action taken against offending persons.All employees shall comply with applicable laws in Pakistan and non-compliance will render them susceptible to action by the Company. The Company Secretary shall be the compliance officer for the purpose of this Code. creed. The Company may suomoto undertake internal investigation or enquiry in respect of a suspected breach of the Code. disability or marital status. 4. All other persons who may become Directors and employees shall be deemed to have accepted the Code from the date when they become Director or employee of the Company. All Directors and Managers will have to make an annual affirmation of the Code. All the present Directors and employees of the Company shall be deemed to have accepted this Code. sex. Directors and employees shall not discriminate on the basis of race. Benefits No Director or employee shall derive any undue benefit from the Company which would not be otherwise available to him or her in the course of the Company's business. colour. BERGER PAINTS 47 . Enforcement 1. 5. Any form of sexual harassment is prohibited. 3. religion. Non-discrimination All other factors being equal. This Code may be amended by the Board of Directors of the Company. Any person aware of violation of the Code may lodge a written complaint with the Compliance Officer. unless specifically allocated for such purpose. Utilization of Assets The Directors and employees shall ensure that the assets of the Company are utilised in the best interest of the Company and not for their personal benefit.

prior to commencing your project. If you're painting indoors. wear a respirator with a combined vapour/particle cartridge. remove any contaminated clothing and wash your skin thoroughly with water BERGER PAINTS 48 . such as cigarettes or devices that generate sparks. If swallowed: Do not induce vomiting. Remember that oil based paint is flammable so make sure you eliminate any potential sources of ignition. ProductSafety Advice: Keep out of reach of children. then try to avoid any prolonged or repeated skin contact as the base is irritating to the skin.SAFETY It's always a good idea to check out the safety information relating to the specific type of paint that you're using. When spray painting an oil based paint. If you're using an oil based paint. First aid: Eye contact: If contact is made with the eyes. Drink plenty of water and seek immediate medical help. then hold your eyes open and flood them with luke warm water for at least 5 minutes and then immediately consult a doctor. or painting an interior wall or ceiling with an oil based paint. ensure you provide adequate ventilation by keeping windows and doors open during use and while drying. Skin contact: If skin contact occurs.

our shareholders. We will stay in the forefront of innovation and technological development in the paint industry.MISSION STATEMENT     The company's employees are constantly encouraged to pursue the fulfillment of the Corporate Mission Statement. BERGER PAINTS 49 . our suppliers and all our others business associates. We will vigorously promote and safeguard the interests of our employees. We will achieve corporate success through an unwavering commitment to provide our customers high quality products to their ultimate satisfaction.

The Company remains aware of the Environmental and health impact of its products. BERGER became the first company in Pakistan to modify its formulations to ensure that all its decorative paints are LEADFREE. BERGER's concern extends beyond the commercial or even the aesthetic aspects. durable. 2. For such types of coatings. conformance with original color is essential and BERGER's technical experts ensure this in its laboratories. BERGER offers three different systems for refinishes designed to enable application without heat treatment. Roof shield and Tartaruga. These finishes are high glossed.DIVISIONAL STRUCTURE 1. BERGER decorative also includes exclusive products such as Aquasafe for water tanks. DECORATIVE PAINT The Decorative Division brings BERGER in close contact with a large number of people for whom top of the line brands like Robbialac VIP Emulsion. Robbialac VIP Super Gloss Enamel and Robbialac VIP Allrounder have become household names. ancillaries are also included in refinishes range such as BERGER PAINTS 50 . quick drying and exactly matched with OEM colors. VEHICLE FURNISHING/STOVING PAINTS Vehicle Refinishes Division caters to touch-up or complete repainting of automobiles. Along with finishes.

This makes BERGER's products a complete repainting system for vehicles. which is highly demanded across the nation. bridges. PROTECTIVE COATS The Protecton Division makes heavy duty protective coatings and anti corrosion paints for specialized structures such as barrages. pipelines. 3. all kinds of thinners and COB Lacquer. and a wide range of metal fabrications which are exposed to the hostile environmental elements. boilers. dams.primer. putty. BERGER PAINTS 51 .

Sign up to vote on this title
UsefulNot useful