In the next five years, Berger Paints India, the second-largest paints company in the nation, expects revenues to double to approximately ‘20,000 crores, driven by a general increase in its paints business. Additionally, the corporation has budgeted an investment of around 400 crore for FY24.
The ornamental industry would experience growth because there is so much room for distribution and growth. The second growth opportunity is in the general industries sector, where spending on infrastructure is increasing, and the third opportunity is in the construction chemical and waterproofing industry, according to Berger Paints MD & CEO Abhijit Roy.
However, the investment for this year will be less than the almost $1,100 crore committed for FY23. This amount comprises costs connected to rehabilitation and capacity growth across existing plants.
Due to the construction of its Sandila plant in Uttar Pradesh and the start of commercial production, the capex for FY23 was higher. The plant, in which the company has invested more than ‘1,000 crores, is anticipated to meet the growing demand for its products and reduce production costs. Following the start, its monthly production increased from 63,000 metric tonnes to 95,000 metric tonnes.
A portion of the capex would also be used to increase production capacity by an additional 5,000 metric tonnes, the speaker continued. Regarding the escalating competition in the sector, Roy said Berger Paints will keep concentrating on its current activities because it did not pose a significant danger.
Regarding its plans for organic growth, Roy stated that the business has already purchased land in Panagarh, West Bengal, and is just awaiting approvals, such as environmental clearances, which will take another 8 to 9 months. While the business searches for land in Odisha, it would take another 12 to 18 months to complete construction.
If the “right buy” presents itself, the company, which focuses mostly on the paints and water-proofing area in India, will also pursue acquisitions.
After recovering in February, demand from the rural market was maintained in March and April. With the anticipation of a successful monsoon, demand is anticipated to be robust moving forward. Since Berger Paints will have been in business in India for 100 years in December of this year, the company will also commemorate this milestone.