Kansai to add two more mfg units in India

On back of high demand and lucrative opportunity, Kansai Nerolac has decided to step up its manufacturing activities.

The company plans to build two plants for the production of decorative paints, as per reports. The total annual capacity of the new plants is believed to be 10,000 tonne. For this, the company will be pumping around Rs1,300 crore.

A Firstcall Research report had also indicated earlier that the company plans to invest `600 crore to raise capacity by 50% over the next three years.

Currently, the company has manufacturing facilities in Uttar Pradesh, Maharashtra, Tamil Nadu and Haryana.

The volume growth in the quarter gone by for the company was only 6% on a  year-on-year basis, and was below street estimates.

However, the current quarter (October-December) is expected to be better for the company, both in industrial and decorative segments, on account of the festival season.

The paint industry is estimated to be around Rs29,000 crore and Nerolac is the largest player in the industrial coating segment. Now the company has also begun increasing the focus on the decorative coating part of the business.

“Having consolidated its dominating position in industrial paint segment (around 44% market share ), KNPL envisages an even bigger opportunity in decorative segment (55% of its revenues) which offers both pricing power and better margins and turns aggressive in innovating and launching new eco-friendly, lead-free, zero VOC and series of affordable emulsion paints,” says a report by Sunidhi Research.