Bright Hues
Asian Paints consistently features on the various must-buy lists and has not lost its lustre one bit
Asia’s third largest paint company, Asian Paints, has come a long way to become the largest paint manufacturer in India. The company has not only managed to capture the domestic market, but also created a footprint in 19 countries with 26 manufacturing facilities servicing consumers in over 65 countries under brandnames Berger International, SCIB Paints, Apco Coatings, Taubmans and Kadisco.
Asian Paints has captured the Indian market by pushing new concepts like Colour Worlds, Home Solutions, Colour Next, and Kids’ World. Asian Paints’ decorative coatings segment contributes 81per cent to its revenue. That said, the company has also marked its foray into the Home Improvement and Décor space in India with the acquisition of the Sleek Group, a kitchen solutions provider, and Ess Ess Bath Fittings.
Asian Paints aims to become one of the top five decorative coatings companies worldwide by leveraging its expertise in high-growth emerging markets. Simultaneously, it intends to build long-term value in the industrial coatings business through alliance with established global partners.
Financials
For the year ended March 31, 2015, on consolidation of accounts of the subsidiaries and joint ventures of Asian Paints, income from operations increased by 11.5 per cent to Rs.14,183 crore from Rs.12,715 crore in the previous year. The consolidated profit after tax increased by 14.5 per cent to Rs.1,395 crore from Rs.1,219 crore. The standalone net profit increased by 13.5 per cent to Rs.1,327 crore from Rs.1,169 crore.
The profitability of its decorative coatings business in India improved due to falling raw material prices. The company’s international business performed well amidst challenging market conditions in some key markets like Egypt. That said, Asian Paints is focusing on expanding its presence in key markets of Africa and South East Asia. In February 2015, the company acquired 51 per cent stake in Kadisco Chemical Industry, Ethiopia, and also set up a paint manufacturing facility at Indonesia.
Asian Paints has given 86 per cent returns from January 2013 till mid- July 2015. Suitable for investors with a long-term investment horizon.
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