global expansion

strategy
Painted By:
Aanal Prajapati
Amit Parmar
Insiya Kapasi
Shrey Shah
 BACKGROUND
• Largest paint Company

• Operations in different countries

• Vision of Company

• Acquisitions

• Group subsidiaries

• Awards & Recognition (Forbes)

• Plants & processing centers in India

 GROUP SUBSIDIARIES
SUBSIDIARY NAME COUNTRY OF OPERATION

Australia, Tonga, Solomon Islands

Apco Coatings and Vanuatu

BIL (Berger International Middle East, Caribbean and South

Limited) East Asia.

SCIB Paints (Study Construction

Egypt
and Industrial Buildings)

Taubmans Paints Fiji, Samoa Islands

 OBSERVATIONS
• Market leader in India
• Worldwide recognition
• Leader in decorative paints segment
• The strengths of Asian Paints
o Lower production costs
o Strong and wide distribution network
o Continuous innovation in technology

• Growth rate 8% annually

• sales revenue is up by 18% year by year
 PROGRESS & DEVELOPMENT
• Establishment of company [1945]

• Concentration on smaller towns

• Introduce mini packs of paint [1954]

• Overseas selling [1969]

• Transformation to public limited company [1973]

• Collaboration with Nippon paints Ltd, Japan

 PROGRESS & DEVELOPMENT
• Backward integration (Chemicals) [1987]

• International expansion

• Manufacturer of premium paints

• Concentrate on brand building

• ‘Merger & Acquisition’ strategy

KEY FEATURES OF PAINT MARKET
 KEY FEATURES OF PAINT MARKET
• Size of paint market
• Reduction in excise duty
• Per capita annual consumption
• Working capital intensive and raw material
intensive
• Market is dominated by decorative paints
• Players in indian paint market
• Foreign players in market
DECORATIVE SEGEMENT IN INDIA
 STRATEGIES ADOPTED BY ASIAN PAINTS

• Strong marketing and corporate strategies

• Introduce wide range of products

• Strong distribution channels

• Implemented i2 solutions for planning, sales

forecasting, supply chain tasks.
• Raw material acquisition
STRATEGIES ADOPTED BY ASIAN PAINTS

• Use of intermediaries as a marketing tool

• Rural Markets: Tailor made products and

packaging
• Merger & Acquisition with the global
players
• Leverage on its experience and launching
newer products at a faster rate
STRATEGIES OF COMPETITORS
 ICI PAINTS

• Established in 1926

• Global leader in paint market with 40%

market share
• Planning to invest in Vietnam and China to
increase manufacturing capacity
• Expanding its distribution network in US
 NIPPON PAINTS

• Established in 1881

• leading paint and coatings manufacturer in Asia

• Promote its marine coatings

• Provides technical services to customers for new

buildings and repair of ships in and outside Japan

• Aims to sharpen competitive edge in the Asian market

 TOA Paints
• Thailand based established in 1957

• Dominated domestic Thai market two decades

• 20th largest paint manufacturer in the world

• Green marketing: concern for safety and environmental

standards

• Increase capacity in China and Vietnam plants

• Introduce Italian technology

 OBSERVATIONS
• Very enthusiastic about entering into unexplored territories

• Extensive use of intermediaries

• Focus on rural area

• Strong distribution networks

• Increasing their production capacity to serve large span of

customers
• Competitors are targeting Asian market
DEMAND & SUPPLY OF PAINTS

• Demand for Decorative Paints

• Demand for Industrial paints

• Supply of Paints
PAINT PRODUCTION IN INDIA (IN TONNES)
 PER CAPITA CONSUMPTION
COUNTRIES PER CAPITA CONSUMPTIONS

India 0.5 kg
South East Asia 4 kg
Developed nations 22 kg
Global Average 15 kg

• Demand is rising specifically for decorative paints

• By 2013 paint market will be of 2.7 million tones

• Industry is growing by 13% annually since last five years

CURRENT POSITION OF ASIAN PAINTS
Performance of Asian Paints in the Different Regions

SALES GROWTH
REGION PBIT REMARKS
(Crores) RATE
 Subsidiaries in Jamaica and Barbados are
Carribean 196 2% 12
higher performer

 Largest operating region outside India.

Middle-East 652 15% 101  Contributes 54% revenue from overseas
operations.

South Asia 187 28% 18  All subsidiaries are performing well

South East  Severally impacted by global meltdown.

96 11% 8
Asia  Subsidiaries were divested.

 Increase in sales is due to impact of

South Pacific 85 7% 9
exchange rates.
CURRENT POSITION OF ASIAN PAINTS
MARKET CAPITLISATION
 CONCLUSION
• World paint market is growing

• Tough competition for Asian Paints

• Emerging markets are top priorities

• Competitive advantage to organized sectors

• Each player has got specialization in particular segment

• Strategies have worked for them

• M & A strategy adopted to International market

• Strong presence in different regions

THANK
YOU