Coatings World - October 2014

The Indian paint industry is likely to surge from the current level of about Rs. 40,600 crore to about Rs. 62,000 crore by 2016 witnessing double-digit compound annual growth rate (CAGR) of about 20 percent, according to The Associated Chambers of Commerce and Industry of India (ASSOCHAM).

The factors that have fuelled the paint industry’s growth are the rise in disposable income and education, increasing urbanization, development of the rural market and various launches of many innovative products.

The ASSOCHAM report on “Indian paint Industry: 2014” reveals that India is the second-largest consumer of paint in Asia. Top players include Asian Paints, Kansai Nerolac Paints, Berger Paints, AkzoNobel, Nippon Paints and Shalimar Paints.

“The Indian paint industry has seen a gradual shift in the preferences of people from the traditional white wash to higher quality paints like emulsions and enamel paints,”said D S Rawat, secretary general ASSOCHAM.

As per the ASSOCHAM findings, the rural market has grown at a rate of around 20 percent per year (in financial year 2014). Increase in sales outside metros, as rural India’s incremental consumption expenditure is witnessing a handsome growth.

The rural sector has a major share of the decorative paints segment. Thus, any benefit to the rural sector for improving the dispensable income is directly corelat-ed to the growth of the paint industry. Besides, decorative paints are marketing savvy products backed by large advertisement campaigns and dealership networks.

In FY14, the paint industry stood at Rs 40,600 crore with per capita consumption increasing to over 4 kgs, out of which the decorative segment contributed nearly 73 percent at Rs 29,638 crore, while the remaining Rs 10,962 crore was contributed by the industrial segment.

“Demands for decorative paints arise from household paintings, architectural and other display products. The demand for paint increases during festive season like Dusherra, Diwali, Onam, Christmas / New Year, as compared to other periods,” said Rawat.

The major boost to the growth in the Indian paint market has been provided by the decorative paint segment, which is anticipated to grow at a CAGR of more than 18 percent during the period 2014- 15. The decorative paint market has been further segmented into emulsions, enamel, distemper and cement paints. Similarly, the industrial paint market is also segmented into automotive coating, high performance coating, powder coating and coil coating, adds the paper.

Some of the major reasons for the rise in the paint industry are awareness about environment and increases in disposable income are leading to demand for premium paints. The rising income levels and exposure to global trends have made consumers very aspiring and also become health conscious and using environmental friendly products, according to the ASSOCHAM paper.

The unorganized sector controls around 35 percent of the paint market, with the organized sector accounting for the balance. In the unorganized segment, there are about 2,500 units having small and medium sized paint manufacturing plants. Top organized players include Asian Paints, Kansai Nerolac, Berger Paints and ICI.

Growth Expected to
Greatly Improve in China’s
Anticorrosion Coating
Market

GCiS China Strategic Research estimates
that the domestic market for anticorro-
sion coatings in China was worth more
than RMB 36 billion in 2013, with sales
of roughly 1.4 Mn Tons. The study finds
that growth in 2013 was only 2.8 percent,
far below the rapid, often double-digit
growth seen in the previous few years.
This was due in large part to the slow
growth of key downstream industries, es-
pecially in the shipbuilding sector, which
saw a strong decline in 2012 and 2013.

Domestic suppliers are mostly small manufacturers that are regionally active and benefit from long standing customer relations. The market leaders are a handful of foreign suppliers – AkzoNobel, Jotun, PPG, Hempel – that generate far more revenue than even their largest domestic competitors. Domestic suppliers are improving on technology and product quality, but for the moment the target market still offers better opportunities to suppliers of high-quality coatings.

The report features in-depth analysis of seven key anticorrosion coating product segments, epoxy, polyurethane, rich zinc primer, alkyd, fluorocarbon, acrylic, and chlorinated rubber. It finds that the market is gradually shifting towards higher quality epoxy and polyurethane coatings. Shipbuilding and construction remain as the two largest end-user industries, followed by containers and the petrochemical and chemical industries. GCiS research shows that supplier confidence is high, mainly because of an expected recovery in demand from the shipbuilding sector. GCiS expects growth of the market will significantly improve starting from 2014.

Global Aerospace Coatings
Market Projected to Reach
$2,991 Million by 2019

The report “Aerospace Coatings Market by End-user Industry (Commercial, Military & General Aviation), by User Type (Original Equipment Manufacturer (OEM) & Maintenance, Repair & Overhaul (MRO)), & by Region (North America, Europe, Asia-Pacific, & Row) - Global Forecast to 2019” report analyzes the global aerospace coatings market with respect to market drivers, opportunities, and trends in different regions.