Mumbai: Asian Paints is embarking on its largest capacity expansion this fiscal year, investing Rs 4,000 crore at its Visakhapatnam and Mysuru facilities to add 1.1 million kilo litre to its present output.
The city-headquartered company is setting up plant with a 5 lakh KL per annum capacity at Visakhapatnam at an investment of Rs 1,785 crore and a 6 lakh KL plant at Mysuru pumping in Rs 2,300 crore.
"We are in the midst of our largest capacity expansion. In the first phase, two mega plants with initial capacities of 3,00,000 KL per annum each of water-based paints would be commissioned at Mysuru and Visakhapatnam in FY19," Asian Paints managing director & chief executive KBS Anand said in the annual report.
Asain Paints, which is the domestic market leader, operates in 16 countries and have 25 manufacturing facilities globally, catering to consumers in over 60 countries.
Its industrial coatings business was badly affected in the second half of FY18 due to GST as well rising input costs. But launch of industrial tinting machines in the dealer networks, and the success of its direct-to metal coatings, it could not only retain market share but in fact increase it in the second half of FY18, Anand said.
In the automotive paints segment, the company added Ford and Hyundai during the year. It could also gain market in share in the twowheeler space.
However, Anand said international business did not perform well. While a weak economy and a highly deflated currency hit its Egyptian operations, Ethiopia and Sri Lanka also did not do well. But higher sales in Nepal, Oman and Bahrain could contain some the impact of the poor show by the above markets.
He said the greenfield operations in Indonesia as well as acquisition of Causeway Paints in Sri Lanka have increased its global revenue.
Having completely existed the low growth Caribbean markets, Asian Paints is now focusing on expanding its portfolio into the emerging markets of Asia and Africa, chairman Ashwin Choksi said.
He further said the uncertainty is likely to continue in the current financial year as well, citing the general elections and a slew of assembly polls.
"While the economy gradually absorbs the impact of GST, impending elections across many states and the general elections will add to the instability, Choksi said.
Firstpost is now on WhatsApp. For the latest analysis, commentary and news updates, sign up for our WhatsApp services. Just go to Firstpost.com/Whatsapp and hit the Subscribe button.
Updated Date: Jun 25, 2018 13:00:30 IST