The Hindu Business Line : Shalimar Paints ties up with Korean co for pre-coated metal coatings

SHALIMAR Paints Ltd (SPL) has signed a technical collaboration agreement with Kunsul Chemical Industries Company Ltd (KCI) of Korea for pre-coated metal coatings (PCM).

The company also plans to enter the wood finishes segment, said to be the fastest growing in the industry today, and has nearly finalised a tie-up with an international player.

Under this new agreement, Kunsul Chemical,second largest in Korea for PCM products, will provide the technical know-how to Shalimar Paints for various products — for architectural structures and appliances.

The company is also setting up a greenfield unit (for decorative and industrial paints) at Hosur, at a cost of Rs 15 crore. The site for the plant has been identified. Construction for the first phase is expected to begin in a month, and scheduled for completion in an year from zero date. The initial capacity will be 1,000 kilolitres, and will be gradually scaled up to 1,800 kl.

Shalimar Paints' three manufacturing units are located at Howrah (West Bengal), Nashik (Maharashtra) and Sikandrabad (Uttar Pradesh).

The company has planned to set up its coil coating plant at its Nashik factory at a capital investment of Rs 6 crore. Production is expected to begin by June. Itis also planning further tie-ups with international players in certain other niche segments, and is currently in talks with three European companies.

Mr S.L. Agarwal, Managing Director of the company, told presspersons that the market for PCM coatings now was around Rs 60 crore, with the major players being Berger Becker, Akzo Nobel and BASF.

He said the company was now working on a brand-building exercise with change in packaging, new ad campaigns etc. The initial ad spend is said to be around Rs 5 crore, to be spent in phases, and the Mumbai-based Triton is working on the new ad campaign. The existing SPL logo is also in for a change.

Kunsul Chemical, has grown considerably in India in the last two years, mainly because the construction and appliance sectors now prefer to use pre-coated sheets to enhance productivity and be more cost-effective.

Mr Agarwal said with the increase in global demand, most of the existing manufacturers were going for capacity expansion, "and several major steel manufacturers have chalked out plans for setting up coil coating lines''. At present, 75 per cent of the coil coated sheets are exported, mainly for roofing structures and appliances.

According to Mr Sanddep Sarda, Chief Operating Officer, Tata Steel, Posco and Vardhaman Steel are setting up coil-coating lines, "and therefore, the demand for PCM coatings is expected to go up substantially".

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