Shri Vile Parle Kelavani Mandal’s

Narsee Monjee College of Commerce and Economics

(Autonomous)

Department of Commerce
2022-23

Name of the Course

FYBCOM/SYBCOM/TYBCOM
Semester -1

Title of the Assignment-ETOP analysis of

Asian Paints

Submitted by:
Name Kunal bhavesh shah
SAP No. 45208220147
Contact number 7021666197

Roll No:

E029
 Declaration

I kunal bhavesh shah declare that this

project/assignment

Titled ETOP analysis of Asian paints ’ is entirely my own work and any
additional sources of information have been duly cited.
All the internet sources published or unpublished from which I have quoted or drawn
reference have been referenced fully in the webliography and bibliography list.
I understand that failure to do so will lead to plagiarism and any similarity found with other
work elsewhere will result in severe disciplinary action.
I also understand that I will be called for Viva-Voce/ Presentation (Online/Offline) and
must attend.
I acknowledge it is my responsibility to keep myself updated with the schedule of viva and I
will make myself available during the same.

Name in full

– Kunal

Bhavesh

Shah
Table of contents pg.no

1. Asian paints company details 2

2. Asian paints industrial environment analysis 2
3. Startup history of Asian paints 2
4. Cosumer environment 3
5. Global environment 3
6. Marketing environments 4
7. Campaigns 5
8. Business modal 6
9. Growth 7
10. Financials 8
11. Fall of Asian paints 9
12. Swot analysis 10
ETOP ANALYSIS OF ASIAN PAINTS
Asian Paints - Company Details

Company Asian Paints

Headquarters Mumbai

Founded 1 February 1942

Founders Champaklal Choksey, Chimanlal Choksi, Suryakant Dani, Arvind Vakil

CEO Amit Syngle (1 Apr 2020 - Present)

Ashwin Dani (Chairman) Manish Choksi (Vice Chairman) Amit Syngle (CEO)
Key People
Abhay Vakil (Non Executive Director)

Revenue INR 22,016 crore ($2.9 billion, 2021)

Total assets INR 22,370 crore ($2.7 billion, 2021)

Type Public

Asian Paints – Industry environment analysis

Asian Paints came out as the market leader in the paints segment, when last seen in 2020. The
company boasted of having a market share of around 39% back in 2020. Talking about the
organized segment, Asian Paints led the decorative market segment, while Kansai Nerolac
led the industrial segment. The Indian paint industry saw a 12% growth in its output volumes
in 2019, while in terms of its total value, it witnessed a 15% growth.

Market Share of the Paints Industry in 2020

The current market share of Asian Paints has been recorded at nearly 50% of the Indian
paints industry.

Startup Story and History of Asian Paints

Asian Paints was started in 1942 by four entrepreneurs: Champaklal H. Choksey, Chimanlal
N. Choksi, Suryakant C.Dani, and Arvind R. Vakil. Champaklal and others initially
functioned out of a garage in Bombay that was rented at INR 75 per month. The main aim
behind the launch of Asian Paints was to found the world's biggest and the most successful
paint company operating in India.

Asian Paints was known as ‘The Asian Oil & Paint Company' in the beginning; the name was
randomly picked up at that time from a telephone directory. It was a set up as a partnership
firm of four friends when it was started in 1942.
In 1945, the partnership firm turned itself into a private limited company following a
turnover of INR 0.35 million that year.

During World War II and the Quit India Movement of 1942, there was a temporary ban
on paint imports. As a result, companies such Shalimar Paints and Asian Paints took it up
themselves to sustain the demand for paints. Asian Paints reported an annual turnover of INR
23 crores in 1952.

In 1957, Asian Paints achieved a breakthrough when its R&D department developed a
process for producing international-quality phenolic and maleic acid resins in a simple coal-
furnace through hand-stirring. In the same year, the company set up a plant at Bhandup,
Mumbai to cater to the rising demand for paints in the urban areas. By 1967, Asian Paints has
already became the leading paints manufacturer in India.

Consumer Environment

Dropping The Mascot

In September 2012, Asian Paints unveiled a new brand identity and a logo made by Soha Ali
Khan, dropping its iconic mascot Gattu in the process. Gattu, the impish boy, was made by
famous Indian cartoonist R.K. Laxman in 1954. The new identity was conceived after the
company conducted an extensive consumer survey in some major Indian cities.

Gattu, the former mascot of Asian Paints.

Asian Paints - Logo and Tagline

Though Asian Paints has come up with numerous taglines, the tagline "Har ghar kuch
kehta hai" is one of the iconic of the Asian Paints taglines.

The logo of Asian Paints is:

Asian Paints Logo

Vision and Goals of Asian Paints

Asian Paints aims to be one of the top five companies in the decorative coatings industry
(worldwide) by enlarging its expertise in emerging markets.

 The company is also working to assure environmental compliance

and sustainability by focusing on waste minimization and water conservation at all of
its plants across India.

 Its mission is to provide paints as per market demand while ensuring the desired level
and quality of customer satisfaction. Asian Paints emphasizes the continuous
availability of the right product mix at the right time.

 Simultaneously, the company intends to take over the industrial coatings business by
forming alliances with established global partners.
Asian Paints - Tools, Products and Services

The Asian Paints tools and products primarily belong to these categories:

Paints and Textures

Health and Hygiene

Asian Paints Tools and Products - Health and Hygiene

The Asian Paints services are varied and spans from interior design services to sanitization
services. Here's a look at all the services of Asian Paints from the Asian Paints official
website:

Asian Paints Services

Global environment Analysis of Asian Paints

Asian Paints runs its business in 15 countries and has 26 paint-manufacturing facilities
worldwide. Besides the brand 'Asian Paints', the group operates around the world through its
subsidiaries: Asian Paints Berger, Apco Coatings, SCIB Paints, Taubmans, Causeway Paints,
and Kadisco Asian Paints.

Asian Paints' global setup is as follows:

 Asian Paints operates in South Asia (India, Bangladesh, Nepal, and Sri Lanka), where
Asian Paints has 15 manufacturing units, and is called Asian Paints Causeway in Sri
Lanka

 The company is present in South East Asia, in Indonesia, where the company has 1
manufacturing plant

 Asian Paints operates in South Pacific, where it has 2 manufacturing plants in total
and serves Fiji, Samoa Islands, Vanuatu, and Solomon Islands. In Fiji, Asian Paints is
known as Apco Coatings and Taubmans and in Samoa Islands, it is known as
Taubmans, while in the remaining countries, Asian Paints is known as Apco Coatings

 Asian Paints operates in the Middle East (Oman, Bahrain, Egypt, Dubai, Qatar),
where it has 5 manufacturing plants. It is known as SCIB Paints in Egypt and Asian
Pains Berger in the rest of the countries

 Asian Paints has set up 3 manufacturing plants in Ethiopia, and is known as Kadisco
Asian Paints

 Taubmans in South Pacific (Fiji and Samoa)

Region-Wise Asian Paints Sales Distribution.

Marketing environment Strategies of Asian Paints

 Unlike its competitors who concentrate only on the urban areas, Asian Paints
embraces countrywide distribution through a widespread network of 13,000 dealers.
The company maintains a large network of regional offices, company depots, and
sales personnel to assist dealers across India.

 Along with initiatives to build customers' trust, Asian Paints also focuses on its
communication and brand strategy. In 2000, Asian Paints appointed the Bangalore-
based "Momentum" as consultants for a new advertising strategy meant to foster an
attractive public image.

 Asian Paints reduced the cost of raw materials to bring down the price of its paints. It
came up with another advertising strategy that created an emotional connection with
the customers.

 Asian Paints is quite strong in production-marketing coordination. Its policy of

offering tailor-made products to fulfill customer needs has resulted in an ever-
increasing product range.

 Corporate reputation has been a major plus point for Asian Paints. The image is that
of a successful, well-managed, and trustworthy company. Asian Paints is the recipient
of several accolades and awards.

 Asian Paints placed a huge emphasis on technology and marketing in its initiatives. It
implemented Enterprise Resource Planning (ERP) and Supply Chain Management
(SCM) solutions for rationalizing processes.

 By partnering with PPG INC, a leading manufacturer of automotive coatings, Asian

Paints seeks to meet the ever-growing requirement of automotive coating, industrial
powder, protective coating, industrial light coating, and industrial container coating
in India.

The above-mentioned steps resulted in a strong emotional connection between Asian Paints
and its customers. The strategies lured in new customers while retaining the existing ones.

Asian Paints' Campaigns

Asian Paints have last made the Bollywood actress Deepika Padukone its brand ambassador,
who featured for the Royal Glitz ad. Deepika Padukone is known for her acting talents and
her endorsements, and is rightly the face of a brand as huge as Asian Paints.

Some of the major Asian Paints campaigns are:

  “Don’t lose your temper, use Tractor Distemper.” This slogan belonged to the very
first campaign launched by Asian Paints. The campaign showed the popular mascot
'Gattu' with a paint bucket in his hand.

 "Har Ghar Kuch Kehta Hai." This campaign established Asian Paints as a
premium brand with an emotional touch. The idea behind the campaign was that each
color had a story to tell. Asian Paints tried to encourage the initiative of painting one's
home for festive occasions like Diwali, marriage, childbirth, etc.

 “Where The Heart Is.” This campaign proved to be a masterstroke strategy for
Asian Paints. It featured celebrities such as Sushant Singh Rajput, Saurav Ganguly,
Radhika Apte, Mandira Bedi, and others who described the significant role Asian
Paints played in their lifestyle through color and home décor.

The campaign featuring Sushant Singh Rajput

 #PeopleAddColour. The recent campaign created a heart-warming depiction of

paying guests not being inferior to one's family. It showed how rooms refurbished
with Asian Paints decals brought paying guests closer to their landlords.

 ‘Budget wala paint’. This Ad campaign ‘Budget wala paint’ promotes Tractor Sparc
Emulsion. By highlighting the budget issues faced by consumers, Asian Paints
launched a pocket-friendly paint that offers a rich-looking finish at an affordable
price.

Business Model and Supply Chain of Asian Paints

Asian Paints is one of the companies that started identifying the trends and of consumption
quite early in its game and eventually constructed innovative and effective strategies around
the same. Asian Paints boasts of a market cap of INR 2,54,125.07 crores and this would
have hardly been possible had it not targeted the right section of people with quality products,
powered by the right marketing mix.

Asian Paints has developed its business on the B2C business models, where the brand
manufactures and distributes products direct to consumers and via retailers and distributors.

No doubt Asian Paints brainstormed amazing advertising campaigns that led to its marketing
wins time and again. For instance, when the company launched Gattu the mischievous kid
in 1954, the mascot immediately appealed to all the Indian consumers, especially the
middle-class society.

Furthermore, the company spent around Rs 8 crores to buy a mainframe computer to become
the first private company to own a computer, which was a bold move indeed. This computer
was used for analyzing data and helped the company in forecasting their demands and
enhancing their service levels across the supply chain, whereas the other companies
continued to use computers generally for payroll and administration works even later.
Asian Paints continued with its judicious investments to improve its supply chain efficiency
and always aimed to stay a step ahead of its competitors and rivals, which it did throughout
the years.

The company launched its IPO as early as 1982 and used the proceedings to expand its
business and launch a wide range of exciting new products. The supply chain practices that
Asian Paints developed, always remained matchless in the paints industry in India. The eye
for innovation with a sole focus on the consumer side of the paint industry is something that
Asian Paints is distinguished for and which fueled the company to pursue with other sub-
brands like Ultima, Royale, and more. All of which enjoyed their own individual successes.

The company also believed in scaling up its operations and improving its factories and their
capacities for expansion with cutting-edge machinery, and a wise investment in their IT
operations.

Along with being one of the most prominent and trustworthy names in the paints
industry, Asian Paints also holds its presence in a wide range of products and industries
including kitchen, bath fittings, and an array of other services like waterproofing
solutions, color consultancy, interior designing and more.

The supply chain practices that Asian Paints developed always remained matchless in the
paints industry in India. Asian Paints distributes its products and services through
retailers, wholesalers, and distributors. The company now operates in more than 14
countries and has already set up 26 paint manufacturing plants enjoying consumers from over
60 countries in total.

Berger International Limited, Taubmans, SCIB Paints, and Kadisco, and Apco Coatings are
some other subsidiaries of Asian Paints that operate globally.

Target Market of Asian Paints

Asian paints target a whole range of customers, including but not limited to homeowners,
corporates, automobile companies, wholesalers, and distributors.

 The retail customers of Asian Paints are usually the people of 20 years and above
from middle, upper-middle, and higher-income groups.

 The corporate customers of the company belong from private companies, government
bodies, and other institutions.

Asian Paints - Growth

Starting before the Indian independence, in 1942, Asian Paints has witnessed a long and
successful journey indeed. Within 25 years of its existence, Asian Paints became a corporate
workforce and emerged as the leading paints company of India. It has been leading India's
paints market since 1967 and is, today, twice the size of any paints company in India.
Asian Paints is present in the Decorative paints department, where the company boasts of
products that caters to Interior Wall Finishes, Exterior Wall Finishes, Enamels and Wood
Finishes. Asian Paints is also present in the Industrial Coatings space, where the company
operates through two 50:50 joint ventures with PPG, Inc, USA.

Asian Paints also diversified into chemical products due to vertical integration, when it
produced products like Phthalic Anhydride and Pentaerythritol, which are used in the paint
manufacturing industries, but the company discontinued the production of Phthalic
Anhydride since the end of July 2017. The Home Improvement and Decor segment also has
Asian Paints' products in the form of Sleek and Ess Ess, which can be seen in the Kitchen and
Bath fittings space.

The company has recently forayed into the Surface Disinfectants and Santisation segment by
launching Viroprotek. Furthermore, Asian Paints is also offering the sanitisation service, San
Assure and Safe Painting service to its customers since the Covid-19 pandemic broke out.

Some more growth highlights of Asian Paints are:

 Asian Paints boasts of a group turnover of $289 bn

 The company is present in 15+ countries and has 26+ paint manufacturing facilities in
the world

 It services consumers from over 60 countries globally

 Asian Paints currently enjoys the possession of over 50% of the market shares

Asian Paints Financials

Asian Paints registered its revenue from operations in Q4 FY2022 at Rs 7892.67 crore ,
thereby witnessing an 18.66% jump. The consolidated sales of Asian Paints also saw a rise of
over 20% from Q4 FY2021, which became Rs 7890 crore. The PBDIT of the company
witnessed a 12.8% surge, which was Rs 1156.31 crore and became Rs 1304.88 crore.

The consolidated sales of Asian Paints increased by 34.6% from Rs 21,485.20 cr in FY21 to
Rs 28,923.48 cr in FY22. However, the PBDIT decreased from Rs 4304.35 crore in FY21 to
become Rs 4303.42 crore in FY22.

The table below highlights some important financial metrics of Asian Paints between FY18-
22.

Particulars 2021-22 2020-21 2019-20 2018-19 2017-18

Total Income ₹25188.51 cr ₹17551.63 cr ₹16,670.59 cr ₹16,676.59 cr ₹14445.36 cr

Total Expenses ₹20148.83 cr ₹14023.67 cr ₹13337.05 cr ₹13083.83 cr ₹11247.36 cr

EBITDA ₹5039.68 cr ₹4859.51 cr ₹4214.58 cr ₹3586.76 cr ₹3198 cr

Particulars 2021-22 2020-21 2019-20 2018-19 2017-18

Profit After Tax ₹3134.71 cr ₹3052.51 cr ₹2,653.95 cr ₹2,134.76 cr ₹1894.80 cr

Asian Paints Shareholding

Being one of the largest paints manufacturer in the world, Asian Paints' shares attract the
investors' attention always. The majority of its stakes are held by the Promoter and Promoter
Groups, who are followed by the Instittions, which hold over 28% of the stakes, as of
December 2021.

Asian Paints - Acquisitions

Asian Paints has acquired 3 companies to date. The last of its acquisitions was that of White
Teak, which came in on April 1, 2022. Here's a list of the Asian Paints acquisitions:

Company Acquired Date Deal Value

White Teak April 1, 2022 $14.17 mn

Sleek International March 20, 2013 -

Berger International September 6, 2002 -

Asian Paints - Challenges

Being one of the pioneering companies that shaped the Indian industry of paints, Asian Paints
had to face numerous odd obstacles since it started its journey. Numerous companies have
cropped up and gone but Asian Paints remained the same old favourite of the Indians.

Crude Oil Prices

One of the major challenge that Asian Paints will likely face is the increase of the prices of
crude oil and their derivatives. Zinc oxide, titanium oxide, solvents like turpentine and other
additives are all based out of crude oil and its derivatives. Therefore, an increase/decrease of
the prices of them directly affects the prices of the paints and other products of Asian Paints.
Besides, the raw materials make up around 55-58% of its total expenses, which is huge
indeed, and any changes in the same, would impact the expenses and the profit/loss scale of
Asian Paints.

Fall of Asian Paints Shares

The shares of Asian Paints has reportedly fell by around 7% on May 25, 2022. The company
has noted over 9% fall of its share in the last two days on May 25th and 26th, 2022. One of
the most prominent reasons for the fall of the Asian Paints shares is the announcement by
Grasim, where the company has announced that it will be increasing its capital expenditure in
the paint business by nearly Rs 10,000 crore over the 2-3 years upcoming. This is done by the
Aditya Birla-owned company to increase its production capacity. This move by Grasim is
will certainly increase competition in the market. Asian Paints, which has currently been
found to possess over 50% of the market share, might also see a decline of its total market
share in the upcoming years.

Asian Paints' shares are currently trading at Rs 2843.40 per share, which is much less than its
52-week high price of Rs 3590.

The Asian Paints' shares had last tanked in March 2022, when the shares of the paints
company dipped by 15% in just 3 days.

Covid Waves

Asian Paints had also seen the worse during the Covid-19 onslaught, where along with
witnessing a dip in its sales and services, the company also witnessed demand uncertainty
and more.

Asian Paints - Future Plans

Asian Paints aims to consolidate its dominant market position in India by launching new
products that will be in line with the developments that the Indian market is seeing both in the
decorative paints and industrial coating segments.

SWOT ANALYSIS OF ASIAN PAINTS

Strengths of Asian Paints

Strengths are the firm's capabilities and resources that it can use to design, develop, and
sustain competitive advantage in the marketplace

- Wide geographic presence - Asian Paints has extensive dealer network and associates
network that not only help in delivering efficient services to the customers but also help in
managing competitive challenges in Chemical Manufacturing industry.

- Market Leadership Position - Asian Paints has a strong market leadership position in the
Chemical Manufacturing industry. It has helped the company to rapidly scale new products
successes.

- Diverse Revenue models - Over the years Asian Paints has ventured into various
businesses outside the Basic Materials sector. This has enabled the company do develop a
diversified revenue stream beyond Basic Materials sector and Chemical Manufacturing
segment.

- High margins compare to Chemical Manufacturing industry's competitors - Even

though Asian Paints is facing downward pressure on profitability, compare to competitors it
is still racking in higher profit margins.

- Talent management at Asian Paints and skill development of the employees - Human
resources are integral to the success of Asian Paints in Chemical Manufacturing industry.
- First mover advantage in the increasingly crowded market place. The new products are
rapidly increasing Asian Paints market share in the Chemical Manufacturing industry.

Weaknesses of Asian Paints

What are "Weaknesses" in SWOT Analysis?

Weaknesses of Asian Paints can either be absence of strengths or resources of

capabilities that are required but at present the organization doesn't have. Leaders have
to be certain if the weakness is present because of lack of strategic planning or as a
result of strategic choice.

- Business Model of Asian Paints can be easily imitated by the competitors in the Chemical
Manufacturing industry. To overcome these challenges companyname needs to build a
platform model that can integrate suppliers, vendors and end users.

- Niche markets and local monopolies that companies such as Asian Paints able to exploit are
fast disappearing. The customer network that Asian Paints has promoted is proving less and
less effective.

- High cost of replacing existing experts within the Asian Paints. Few employees are
responsible for the Asian Paints's knowledge base and replacing them will be extremely
difficult in the present conditions.

- Gross Margins and Operating Margins which could be improved and going forward may put
pressure on the Asian Paints financial statement.

- Loyalty among suppliers is low - Given the history of Asian Paints coming up with new
innovations to drive down prices in the supply chain.

- High turnover of employees at the lower levels is also a concern for the Asian Paints . It can
lead to higher salaries to maintain the talent within the firm.

Opportunities for Asian Paints

What are "Opportunities" in SWOT Analysis?

Opportunities are potential areas where the firm chan identify potential for - growth,
profits, and market share.
- Rapid Expansion of Economy As the US economy is improving faster than any other
developed economy, it will provide Asian Paints an opportunity to expand into the US
market. Asian Paints already have know-how to operate into the competitive US market.

- Lower inflation rate - The low inflation rate bring more stability in the market, enable credit
at lower interest rate to the customers of Asian Paints. This will increase the consumption of
Asian Paints products.

- Local Collaboration - Tie-up with local players can also provide opportunities of growth for
the Asian Paints in international markets. The local players have local expertise while Asian
Paints can bring global processes and execution expertise on table.

- Increasing government regulations are making it difficult for un-organized players to

operate in the Chemical Manufacturing industry. This can provide Asian Paints an
opportunity to increase the customer base.

- Increasing customer base in lower segments - As customers have to migrate from un-
organized operators in the Basic Materials industry to licensed players. It will provide Asian
Paints an opportunity to penetrate entry level market with a no-frill offering.

- Trend of customers migrating to higher end products - It represents great opportunity for
Asian Paints, as the firm has strong brand recognition in the premium segment, customers
have experience with excellent customer services provided by Asian Paints brands in the
lower segment. It can be a win-win for the company and provides an opportunity to increase
the profitability.

Theats to Asian Paints

What are "Threats" in SWOT Analysis?

Threats are factors that can be potential dangers to the firm's business models because
of changes in macro economic factors and changing consumer perceptions. Threats can
be managed but not controlled.

- Changing demographics - As the babyboomers are retiring and new generation finding hard
to replace their purchasing power. This can lead to higher profits in the short run for Asian
Paints but reducing margins over the long run as young people are less brand loyal and more
open to experimentation.

- Trade Relation between US and China can affect Asian Paints growth plans - This can lead
to full scale trade war which can hamper the potential of Asian Paints to expand operations in
China.

- Changing political environment with US and China trade war, Brexit impacting European
Union, and overall instability in the middle east can impact Asian Paints business both in
local market and in international market.
- Distrust of institutions and increasing threat of legal actions for Asian Paints - As the WTO
regulations and laws are difficult to enforce in various markets. Legal procedures have
become expensive and long drawn process. It can lead to less investment into emerging
markets by Asian Paints thus resulting in slower growth.

- Shortage of skilled human resources - Given the high turnover of employees and increasing
dependence on innovative solution, companyname can face skilled human resources
challenges in the near future.

- Competitors catching up with the product development - Even though at present the Asian
Paints is still leader in product innovation in the Chemical Manufacturing segment. It is
facing stiff challenges from international and local competitors.

CONCLUSION

Asian paints, being an established company has succeeded in becoming a market leader in the
Indian paint industry. The brand does well and has seen enormous growth ever since its
formation. It has unique marketing strategies and has gained the majority market share.

There have been issues due to the ever-changing demands of customer choices. However, the
brand is performing well and has to retain its strong market presence by staying on par with
the customer demands. With its superior technologies, it has seen a huge rise in various
products and also is also seen at the top of the industrial segment.

As it owns major brands, Asian paints are always the first choice for those individuals or
organizations who are looking for renovation and improvement in their buildings or home.
By focusing more on its weaknesses and threats, Asian paints can turn the business to a new
level

References

www.tradebrains.in

www.groww.in

simconblog.wordpress.com

www.equitymaster.com

https://startuptalkies.com