Berger Paints India expects to keep growing its market share despite competition: Abhijit Roy, MD & CEO

We began our journey as a very small company named Hadfield’s (India) Ltd on December 17, 1923. After it was sold to British Paints, the company came to be known as British Paints (India) Ltd. Following its acquisition by Berger Paints, the company was renamed Berger Paints India. In the early days, foreigners were appointed managing directors of the company, which was then an industrial paints maker. After it was acquired by the Vijay Mallya family, the company became part of the UB Group. In 1989, the company’s present chairman Kuldip Singh Dhingra acquired the company from Mallya. It first entered the decorative paints business in the 80s.

We crossed Rs 10,000-crore in revenue in the financial year 2022-23. We are the second largest paint company in India and the fourth largest in Asia today. The decorative segment, in which we have around 20 per cent market share, contributes around 80 per cent of our overall sales.

The decorative paints segment, which accounts for around 75 per cent of the domestic industry, is estimated at around Rs 60,000 crore. The e segment is growing at a 12-13 per cent, and we expect it to maintain this pace going forward. There is scope for geographical expansion with the addition of new dealers, especially where we are relatively under-represented, mainly in the West and the South of the country. We will explore the launch of new and interesting products and product categories, with significant growth opportunity. The third is premiumisation of existing product ranges. So, we see the possibility of strong growth in these three areas. In terms of market share, we have been gaining 0.5-0.7 per cent on a year-on-year basis in the last three-to-five years. We are looking at similar growth going forward, though competition has grown with the entry of new players. We are looking forward to Rs 20,000 crore in revenue by FY30.

The paint industry is a slightly difficult category, with many elements in it. The consumer is important, so is the dealer, and the other influencers, including painters, contractors, builders, architects and interior decorators. They all need to be tied in together. If any element is missing, it would be difficult to convert customers. Therefore, change or progress in the industry is normally slow. Small incremental changes can happen with some difficulty. Grasim Industries, another competitor in the space, has group funding and knows the Indian market. So, it is a serious competitor for sure. There have been many big international players who are equally well-funded, with all the technologies and knowledge. But they have not done anything spectacular in India so far. At the same time competition makes you more efficient, it drives you to start thinking about your own strategies, and how you can sustain yourself. So, we are likely to become more innovative and efficient. It is a good thing to have some amount of competition. The industry has always been very competitive and it still is.

Currently, the total capacity is around 1.05 lakh tonnes per month. We are looking at some expansion in existing capacities. We are setting up a new plant at Panagarh in West Bengal for industrial paints and construction chemicals. We are also looking at setting up a comprehensive plant in Odisha for both decorative and industrial paints. Capital expenditure on this plant would be over Rs 1,000 crore, and it is expected to be operational in two-and-a-half to three years.