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*[image: Ramakanth V. Akula.jpg]— Ramakanth V. Akula, President - Decorative, Nippon Paint (India) Pvt. Ltd* Nippon Paint of Japan, a leading player in the global paints and coatings industry, entered India in 2006 and has garnered a sizeable share of the paints market in just four years. *Lalitha Rao* interviewed *Ramakanth V. Akula* for his views on the emerging trends in the paint industry and his company's future plans. *What is the current size of the Indian paint industry and at what rate is it growing? What are the emerging trends in the paint and decorative segment? *The Indian paint market is estimated at [image: rs1.jpg]21,000 crore and the industry is growing at 18 per cent. The emerging trends in the decorative industry are: - Consumers are increasingly involved in making purchase decisions. - Consumers expect better and more relevant functional benefits from paints. - Emulsion paints are outgrowing the industry growth rate. - Trend of dark shades complementing light shades continues. - Tinting systems at store level are the order of the day. - Companies are getting more consumer-centric and a lot of value-added services are being offered, like application support, colour consultancy etc. *Between industrial and decorative paints, which segment enjoys better margins? * Margins have been more or less consistent in the paint industry over the past few years. Margins in decorative paints are normally higher than the ones in industrial paints. In India, the split between industrial and decorative paints is 30:70; in all developed countries the split is reverse. It might take us a long time to reach that kind of situation but with the kind of industrial growth happening we think industrial paints would tend to increase their contribution in the total pie. *What about the repainting and new construction segment? * The breakup between repainting and new construction is 70:30 on the whole. This ratio changes in the metros and mini metros to 55:45 between repainting and new construction. *What is your company's strategy for growth? * Infrastructure should gear up to complement growth plans we envisage for India. The paint industry is bound to grow by 20 per cent each year. We are focusing on emerging categories like emulsion paints, wood coatings, textures and high-performance coatings. We have introduced differentiated products of high value in the market. These products are not only functionally superior but also environmentally friendly and health friendly. We are offering many value added services to customers through our exclusive store format. Consumers get a touch-and-feel experience in the store and also other services like application support, colour consultancy etc. Geographical expansion and new products will drive our growth. *[image: Nippon Paint.jpg]Can you highlight some of the recent changes in the paint industry? * Paints with functional benefits are witnessing good demand; all these products are made through breakthrough technologies. Low VOC coatings, solar reflect coatings etc., are few examples of products being developed using the latest technologies. * Do you have any expansion plans? * We commissioned our first plant for decorative paints at Sriperumbudur near Chennai in Tamil Nadu in February 2009. The plant can produce 20,000 kilolitres of paint a year. We are doubling the capacity at the Chennai plant by 2011. Work on phase-I of the Taloja decorative paint plant near Pune in Maharashtra, which is being set up at a cost of [image: rs1.jpg]40 crore with a production capacity of 10,000 kl, is expected to go commercial in April 2011 and phase-II by 2015. We will continue to launch more products and expand horizons in all markets of India in a phased manner. *Tell us briefly about Nippon Paint in India. * We started our operations in India in 2006. Initially we were importing and selling in the southern states. As mentioned, we commissioned our first decorative plant in 2009 in Chennai. Recently, we launched our marketing operations in Mumbai. Having set new benchmarks of quality in India over the past four years, our dedication to innovation of products and our excellent customer service has been consistently recognised. Nippon Paint has always understood and worked towards the needs of its customers. Our journey towards a world full of beauty and colour continues. Nippon's entry into Mumbai is in line with our global plans. This move is in line with our constant endeavour to provide our customers high-quality products in the most cost-effective way and making them available at the right time and right place. Our other plans in India include a plant for decorative paints in Haryana, which is likely to be set up by 2012 and commissioned thereafter in one year. We are negotiating with HSIDC for approvals, which are to be finalised soon. In next three to four years, we will stabilise our position in the northern part of the country. -- Regards Hardik Shah -- You received this message because you are subscribed to the Google Groups ""GLOBAL SPECULATORS"" group. To post to this group, send email to [email protected]. To unsubscribe from this group, send email to [email protected]. For more options, visit this group at http://groups.google.com/group/globalspeculators?hl=en.
