Paint Makers Shift to Industrial Coatings for Growth
Key Highlights
Indian paint companies like JSW & Berger are focusing on industrial coatings for better margins due to rising costs and competition in decorative paints.
Indian paint manufacturers are increasingly turning their attention to the industrial coatings segment as rising raw material costs and intensifying competition in the decorative paints market squeeze margins. Companies such as JSW Paints and Berger Paints are seeking more stable and profitable growth opportunities in the industrial sector.
The shift comes as the decorative paints segment faces disruption from new entrants like Birla Opus, which is backed by the Aditya Birla Group. This increased competition, coupled with the volatility in crude oil prices (a key input for paints), is prompting established players to diversify their portfolios.
Industrial coatings, used in automotive, construction, and other sectors, typically offer higher margins compared to decorative paints. They also tend to be less susceptible to seasonal demand fluctuations, providing a more consistent revenue stream.
JSW Paints, for example, has been actively expanding its presence in the industrial coatings market, leveraging its existing relationships with industrial clients through its steel business. Berger Paints, a leading player in the Indian paints industry, is also focusing on growing its industrial coatings business through strategic investments and partnerships.
Analysts believe that this trend will continue as paint companies seek to de-risk their businesses and capitalize on the growth potential of the Indian industrial sector. The move towards industrial coatings is expected to provide a cushion against the cyclical nature of the decorative paints market and ensure sustainable long-term growth for these companies.