type public (BSE: 500820,NSE: ASIANPAINT) ,FORBES GLOBAL MAGAZINE

Industry Paint

Founded 1942

Headquarters Mumbai, India

Key people P M Murty (MD & CEO)

Products AncillariesAutomotiveDecorative paintsIndustrialPaint selector

Revenue 6,680.94 crore (US$1.48 billion)(2009-10)

Profit 1,256.09 crore (US$278.85 million)(2009-10)

Employees 4,382 (2009-10)

Website www.asianpaints.com

OVERVIEW:

India's largest paint company One of the top ten decorative coatings companies in the world. Started by four entrepreneurs, Champaklal Choksey, Chimanlal Choksi,

Suryakant Dani and Arvind Vakil Turnover: INR 0.35 million(1945) to 54.3 million(2009) PM Murthy( MD & CEO)

Asian Paints is India's largest paint company and the third largest paint company in Asia today, with a turnover of Rs 36.7 billion(around USD 851 million). The company has an enviable reputation in the corporate world for professionalism, fast track growth, and building shareholder equity. Asian Paints operates in 21 countries and has 29 paint manufacturing facilities in the world servicing consumers in over 65 countries. Besides Asian Paints, the group operates around the world through its subsidiaries Berger International Limited, Apco Coatings, SCIB Paints and Tubman’s.

BRAND LEADERSHIP MODEL:ASIAN PAINTS

a) 1942-1967: Evolution Phase

b) 1967-1982: Extension and Consolidation Phase c) 1982-1986:The years of Excellence d) 1987-1997:Moving Closer to the Consumer  e) 1997-1999: Changing rules of the game f) 1999- 2007: The new Asian Paints

Industry Analysis: Porters 5 force Model

Existing Rivals1. Berger

2. GN3. ICI

4. JNPL

Substitutes1.White cement2.White wash

3. Brick & stone Structure

Suppliers 1.Tio2 Imported, 2.Few suppliers,3.Availability of

Substitutes of RM Low

HIGH BARGAINING

POWER

Threat Of New Entrant

1.Growth rate much higher than global so global player may be

interested2. Huge potential

to increase per capita

consumption. Thus Latent need exists.3. Companies can erode into APIL’s industrial market by forming JV’s.

BUYERS1. Decorative: Fragmented Market. LOW

POWER2. Industrial: Low switching costs. Corporate have HIGH POWER

The countries that Asian Paints has presence are as follows:South Asia  : Bangladesh, Nepal, and Sri LankaSouth East Asia  : China, Malaysia, Singapore and ThailandCaribbean Islands  : Barbados, Jamaica, Trinidad and TobagoMiddle East  : Bahrain, Egypt, Oman and United Arab EmiratesSouth Pacific  : Australia, Fiji, Solomon Islands, Samoa Islands, Tonga and Vanuatu

Annual result

  Mar ' 10Mar '

09

Sales 5,125.08 4,270.5

Operating profit 1,010.00 561.27

Interest 13.76 10.40

Gross profit 1,140.09 610.93

EPS (Rs) 80.74 37.73

Company Decorative Market

APIL 37.50%

GNPL 10%

Berger Paints 11.20%

ICI 7.80%

Jenson & Nicholson 5.50%

Others 38%

Market Share

Entry of Global Player in asian Paint Industry: Recent JV agreement

Company Collaborator Purpose

Asian Paints Nippon Paints

PPG Industries

Sigma Coatings

BASF

Pre treatment chemicals, Coil & Powder

coating

Automotive paints

High performance coating

Can coating

Sales Performance Q3 FY2010-11

1st QTR

FY 10

2nd QTR

FY 10

3rd QTR

FY 10

4th QTR

FY 10

12 m FY 11

1st QTR

FY 11

2nd QTR

FY 11

3rd QTR

FY 11

0%5%

10%15%20%25%30%35%40% standalone sales & operating income

•Consolidated sales grew by 29.6% in value terms Growth of 29.1% with comparable period of overseas subsidiaries• Standalone paint sales grew by 37.3% in value terms

Profit Performance Q3 FY2010-11

1st QTR FY10

2nd QTR

FY 10

3rd QTR

FY 10

4th QTR

FY 10

12 M FY 10

1st QTR

FY 11

2nd QTR

FY 11

3rd QTR

FY 11

0%

10%

20%

STANDALONE PAINT SEGMENT EBIT MARGIN

Consolidated PBT at Rs.329.8 crores Growth of 7.3% over Q3 FY09-10 PAT after Minority Interest at Rs. 220.3crores Growth of 11% over Q3 FY09-10 Standalone PBT at Rs. 294.9 crores Growth of 12.2% over Q3 FY09-10 Margins still higher than long term average

Sept 2010 Results Asian Paints consolidated Net Sales for the half year increases by 14.3%

.Consolidated Results ; H1-FY2011 : For the six months ended Sept 30, 2010, Sales & Operating Income has increased by 14.3% to Rs. 3641 crores from Rs. 3184.2 crores.  PBDIT has increased by 13.4% to Rs. 678.6 crores from Rs. 598.6 crores.  Net Profit after Minority Interest stood at Rs. 436.9 crores as compared to Rs. 444.5 crores in the previous corresponding period.  PBT was at

Rs. 657.8 crores..

Standalone Results : H1-FY2011: For the six month period ended Sept 30, 2010, Net Sales increased by 16% to Rs. 2960.6 crores from Rs. 2551.3 crores.  PBDIT increased by 12.9% to Rs. 589.2 crores from Rs. 521.7 crores.  Net Profit on a standalone basis stood at Rs. 397.1 crores as

compared to Rs. 418.8 crores in the previous corresponding period.Dividend : The Board of Directors recommended the payment of an interim dividend of Rs. 8.50

per share (85%).  The company distributed an interim dividend of Rs. 8.50 per shares (85%) for H1-FY2010.  Total dividend of Rs. 27 per share (270%) was distributed in FY2010.  The dividend

payout ratio was 39% in FY2010.

Business Strategy: Urban Market

AP could have two different approaches

The first approach would entail creating a service arm that can cater to a large market

The second one would necessitate the creation of a well-qualified service arm which is capable of providing value-added services.

Business Strategy: Rural Market It should be Implemented in

two parts.1. The penetration of the rural segment

have to be achieved by offering a basic product well tailored to match the low willingness to pay of the rural consumer.

2. After basic penetration levels have been achieved the rural consumer can be offered a “higher ” range of products with a view to up grading the consumers.

Business Strategy: International Markets

For the newly Acquired Global Companise Utilization of the learning curve effect and the knowledge base from having functioned in a developing country would be the most crucial factor for growth.

Vision

To identifying needs of customers. Delivering customers value for money. Contribution to society. Maximum long term value for stake holders.

Awarded the "Sword of Honour" by the British Safety Council for all the paint plants in India. This award is considered as the pinnacle of achievement in safety

across the world.Forbes Global magazine, USA ranked Asian Paints

amongst the 200 'Best Small Companies of the world' in 2002 and 2003 and amongst the top 200 'Under a

Billion Firms' of Asia in 2005.Ranked 24th amongst the top paint companies in the

world by Coatings World - Top Companies Report 2006.

The Asset - one of Asia's leading financial magazine ranked Asian Paints amongst the leading Indian

companies in Corporate Governance in 2002 and 2005.

Received the Ernst & Young "Entrepreneur of the Year - Manufacturing" award in 2003.

Awards & Recognition

SWOT ANALYSIS STRENGTH: Market leaders with 44% market shares. Strong in inventory control. The pricing strategy is oriented to middle and lower end consumers. Widest product range in terms of products, shades, pack sizes. Comprehensive nation wide coverage of the market.

WEAKNESS: Seasonal demand and hence in off seasons it can lead to cash flow problems. Innovation in developing new product is inadequate. Weakness on the technology front in industrial paints.

OPPORTUNITIES: The automobile industry accounted for 50% of the industrial markets

. THREATS: Competitors have gone in for hi-tech instacolour spot mixing. Domination of few foreign companies. Competition is catching up fast, hi-tech facilities gives abundant choices.

Proper implementation of government accounting policies. Maintaining proper gross working capital of the company.

Proper utilization of advanced technology. Maintaining good relations

with suppliers, creditors & debtors. Innovation & creativity.

CONCLUSION