CHAPTER- 5

BRIEF ABOUT PAINT INDUSTRY

5.1 Introduction

5.2 Definition

5.3 Functions of Paint

5.4 Paint Systems & Components

5.5 Classification of Paint

5.6 Properties of Paint

5.7 Challenges faced by Indian Paint Industry

5.8 List of Selected Paint Units in Gujarat

5.1 INTRODUCTION:

Colour has fascinated culture throughout history, every age and every region has

produced dyes and pigment depending on the available resources. Colour has been

with us for more than 20,000 years. The evidence can be found in the cave paintings.

The tradition of painting in Indian subcontinent grew and developed overtime,

resulting in a hilly developed and finest style, incorporating the culture and faith of

the region and religion. The history of Indian Paint Industry is as old as the history of

the Indian people. Indian paints always embrace rich colours and clear symbolism,

using specific iconography to make religious figures clearly recognizable.

The Indian paint industry has recently completed lOOyears of manufacturing.

Manufacturing of Indian paints started around 1902. The Indian paint industry has

seen a gradual shift in the preferences of people from the traditional white wash to

higher quality paints like emulsions and enamel paints. Growing popularity of new

variants providing improved finishing and textures, increasing per capita income of

people and efforts on the part of manufacturers to introduce improved versions like

eco-friendly, odour free and dust and water resistant paints, have propelled the growth

of the paint market in India. Efforts on the part of the manufacturers to introduce

innovative technologies in the paint market have led to a growth in demand for paints

in India. Paint manufacturers are giving due attention to consumer’s colour

preferences. The market is witnessing introduction of breakthrough technologies to

improve the paint quality. Paint companies are also increasingly investing in their

R&D, to carve out a differentiated product in the market. For instance, paints, which

use water in place of solvent, have been introduced in the market. They are better in

performance and not harmful for health as it emits little or no Volatile Organic

Compounds (VOC). The industry has also seen the introduction of solar reflective

coating, which is a roof surface coating that lowers the surface temperatures of the

roof resulting into greater comfort inside the building. New technologies in the paint

market would lead to better performance, cost reduction and wider applications of

paints in India.

The Indian Paint Industry is only segment of the Indian chemical industry that has

been sharing a consistent double digit growth rate in the last five years. The growth

rates recorded over the last few years have been extremely encountered with upward

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trend in paint demand and consumption. The large scale sector is dominated by four

players, namely Asian Paints, Nerolac Paints, Berger Paint and Dulux India Paints.

The small scale sector consists of over 5000 players. This growth has been closely

linked with the business and industrial development of modem India. Performance is

anchored today in a wide variety of decorative and industrial paints. An ISO 9001

company has come a long way in the highly competitive Indian paints industry and

has its own R&D developing, standardizing and ensuring quality assurance of its

products. It is global company in a real sense. Indian housing sectors are booming and

also increasing urbanization has made easy availability of housing loans. This has

been resulted into a shift from semi-permanent to permanent housing structures.

Growth in the decorative paints segment accounts for nearly 65-70% of the Indian

paint industry. Seasons are also involved in the demand for decorative paints, where

consumption peaks around festive time.

Over the past few years, the Indian Paint market has substantially grown and caught

the attention of many international players. The growth in the market is driven by

emergence of the middle class in India, growing infrastructure, increase in the

tendency to spend and growing young population inclined towards lavish lifestyle.

The country continues to enjoy a healthy growth rate compared to other economics,

backed by the increasing level of disposable income, and demand from infrastructure,

industrial and automotive sectors. Indian paint industry had two types: Decorative &

Industrial Paints. Decorative paint market has been further segmented into

emulsions, enamel, distemper and cement paints. Similarly, Industrial paint market

is also segmented into automotive coatings, high performance coating, powder

coating and coil coating. The major boost to the growth in the Indian Paint market has

been provided by the decorative paint segment, which is anticipated to grow at a

Compounded Annual Growth Rate (CAGR) of more than 16% during the period

2013-14 to 2015-16. Under the decorative segment, the emulsion paint market has

witnessed a massive demand over the past few years and is expected to drive the

market in the coming years too. There is a phenomenal growth on the housing sector

front with rapid urbanization and availability of easy to secure housing loans, which

have become the prime drivers of growth in the decorative paint segment, which

comprises 70% of the $2 billion Indian Paint Industry. An average increase of growth

of about 10% in the automobile sector contributes to 50% of the revenues in the

industrial paints segment.

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Size of the Industry Today India has more than 20,000 outlets in operation,

probably the highest for any country.

Geographical

Distribution

Mumbai, Ahmedabad, Coimbatore, New Delhi, Surat,

Chennai, Delhi, Jaipur, Bangalore, Kolkata, Karur,

Triupur, Ludhiana, Bhilwara, Erode, Jodhpur, Rajkot,

Noida, Panipat, Amritsar, Vadodara, Kanpur, Madurai,

Gurgaon, Hyderabad, Navi Mumbai, Thane, Shanghai,

Pune, Karachi, Faridabad, Indore, Ghaziabad, Varanasi,

Faisalabad, Alappuzha.

Output per annum The high volumes of low cost distempers sold in India,

which amounts to approximately 200,000 tonnes per

annum at an average cost of Rs.35 per kg ($0.88) at the

present rate.

Market Capitalization The market for paints in India is expected to grow at 1.5

times to 2 times GDP growth rate in the next five years.

Chart No: 11. Basic Information of Paint Industry

Today manufacturers in India hardly face any threat from the foreign players. Most of

them have deals with global players in terms of latest technology and market

accessibility. A large number of Paint outlet or shops have automated/manual dealer

tinting systems. Today India has more than 20,000 outlets in operation, probably the

highest for any country. There are only approximately 7,000 tinting systems in China

for a market two and half times of India’s size. 30% to the paint industry revenue in

India is accumulated from Industrial Paints. The size of the Indian Paint Industry is

around 940 million litres and is valued at approximately $2 billion. The organized

sector comprises 54% of the total volume and 65% of the value. In the last ten years,

the Indian Paint Industry has grown at a compounded annual growth rate (CAGR) of

12-13%.

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Today India is booming in the field of infrastructure and industrial development.

Rapid industrialization and improvements in the infrastructure such as transport,

energy and communication during the last decade gave a further fillip to the growth of

the paint industry. So the demand of paint industry is relatively more. Aided by

Government’s liberal policy of technology import, the automotive and consumer

durable segments expanded phenomenally, with a flurry of foreign collaboration.

Increased demand for decorative, protective and functional coatings was a natural fall

out, which brought, in its stride, a host of indigenous development as well as the

injection of new technology. Indian Paint Industry makes great changes in the rapid

industrial development as well as country development. Therefore paint industry is of

crucial importance to India.

5.2DEFINITION OF PAINT:The paint is defined as a coating material in liquid or solid which when spread on a

surface adheres and hardens forming a film that protect, decorated or add a specific

feature to the surface on which it is deposited. It is most commonly used to protect,

preserve, decorate or add functionality to an object or surface by covering it with a

pigmented coating.

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5.3FUNCTIONS OF PAINT:Paint is a fluid that dries to form a continuous solid film when spread over a surface

or substrate. Depending on its type and properties, paint can perform mainly two

types of functions. They are as follow:

• Protection against oxidation, corrosion and degradation of materials.

• Decoration and embellishment of materials and surfaces.

Protection

One major function of the paint is to protect the material or the substrate on which has

been applied, due that once dried and cured, the paint forms an insulating layer

between the external environmental and the material that wants to protect, preventing

the action of external agents such as humidity, salty air, ultraviolet radiation,

chemicals agents, etc. that can induce and cause into the material phenomena such as

oxidation, corrosion or degradation.

Depending on the type of protection that it will use a specific type of paint or other,

protective paints are made with the corrosion inhibiting additives, paints that protect

against sunlight are made with a few amounts of additives that absorb ultraviolet light,

etc.

Decoration

Another major function of paint is to decorate and beautify the material, thanks to the

pigments and additives that include paintings; it is now possible to get a wide range of

colours and decorative effects (chameleon effect, mercury effect) which are enhanced

and do more beautiful the surfaces. Besides these two main functions, the paint can be

designed to have specific functions, such as non-stick paint to facilitate cleaning of

the surfaces, antibacterial paints to prevent the growth of bacteria, antideflagates

paints to extinguish and prevent the action of fire, soundproof paint to absorb noise,

dirt repellent paints, luminescent paint for night signalling, anti-fouling paints for

ships, etc.

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I

Functions of Painti____________________________

a) Decorative

Decorative paint for aesthetic purpose

Descriptions-----------------------------------------------------> Paint can be used as a coating to

decorate a surface or substrate. It

has a wide variety of colour,

texture, finishes and gross level.

b) Protective r

Protective paint for fuel tanks

c) Special Purposes

>

Paint can be designed to protect

the surface or substrate against

ultra-violet rays, humidity,

chemicals, corrosion, algae,

abrasion etc.

Paint can also be formulated for

specific uses such as luminous

paint that glow in the dark for

emergency signage, anti­

condensation paint to provide an

insulating layer to minimise

condensation, fire retardant paint

to enhance the fire resistance of

combustible surfaces such as

softboard or hardboard.

For application of special paints,

refer to manufacturer’s

recommendations.

Chart No: 12. Functions of Paint & Descriptions

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In short, the main functions of paint are as follows:

> To protect the surface from weathering effects of the atmosphere and actions by

other liquids, fumes, moisture, temperature, bacteria, fungi, gases etc.

> To provide pleasing, colourful and decorative appearance to the surfaces.

> To prevent decay of wooden members.

> To prevent corrosion of metallic surfaces.

> To provide a smooth surface for easy cleaning.

> Aesthetic appearance provided by the paint colour and sheen (eggshell, satin or

gloss).

> Providing a desired ability of reflection-absorption of heat and light.

> Changing the surface properties: ant-friction, hardness, electrical conductivity.

> Identification of products according to the colour of the paint.

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5.4 PA I NT SYSTEMS AND COMPONENTS:

A paint system is basically composed of primer/sealer, undercoat and topcoat as

shown in Figure. Depending on the design requirement, texture coating may be

provided. Due to volume constraint, this guidebook will focus on paints that are

commonly used in the local market. The functions of each system component are

illustrated in Table below.

Chart No: 13 Functions of Paint System Components

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System Component Function Remarks

Primer - To improve adhesion. - Primer should be used

- To protect metal against to reduce the porosity of

Corrosion. the surface and to

- To reduce porosity of provide adequate

receiving substrate so moisture resistant

as to prevent undue Capability.

absorption of resin - Etching Primer should

from subsequent be used as pre-treatment

Coats of paints. on non-ferrous surfaces

such as galvanised

metals, aluminium to

ensure good adhesion.

Sealer - To resist alkali attack - Sealers are applied to

from cement based prevent migration of

materials substances from the

- To improve adhesion substrate into later coats

- To seal problematic and should

surfaces, e.g. resinous be used to reduce the

wood porosity of the surface and

- To stabilise loose surface to provide adequate

particles moisture resistant

- To reduce porosity of

receiving substrate so as to

prevent undue absorption

of resin from subsequent

coats of paints

capability

Texture (Optional) - To give a distinct 3- - If applied, this is

dimensional appearance. introduced as the second

coat after application of

sealer/primer. Commonly

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i

i

applied by spray or roller

- Textures are available in

multiple colours to

simulate the look of

granite, tiles, and

wallpaper

- Mock-ups are important

to understand the

appearance of the product

Undercoat - To impart opacity and

film build

- To level out minor

irregularities and provide

uniform texture

- To improve inter-coating

adhesion

- Choice of undercoat

should be compatible with

the primer/sealer and the

finishing coats

Topcoat - To provide the required

Functions of paint.

- This is the finishing

coat of a paint system

which gives the final

appearance in term of

colour, gloss or sheen to

the substrate.

Chart No: 14. Functions of Paint System Components

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Thus, Classification of painting products by their functions

o Paint - coloured non-transparent protective coating.

• Varnish - transparent or semi-transparent protective coating. A varnish is

made of binder, solvent and additives. Some varnishes contain small amounts

of pigment.

• Enamel - hard protective coating with glossy finish.

• Primer - the first coating applied to the surface in order to enhance the

adhesion of the final paint (topcoat) and to seal the substrate surface. Primer

may be formulated to impart additional protection to the substrate (e.g. anti­

rust primer for steel substrates).

The paint is composed of different chemicals substances, natural or artificial, which

can be classified into the following basic compounds:

• Resins and binders- This is the polymer base of the paint and thus is the basic

element. The binder or resin is the actual film forming component of paint. It

is the only component that must be present in paint.

• Pigments - These are solid materials: that provide the tone and colour of the

paints and others like anticorrosion, luminescent, etc. Pigments are granular

solids incorporated in the paint to contribute colour.

• Fillers- Set of chemicals materials that contribute and improve the mechanical,

chemical and physical properties of paints

• Additives - These are chemicals materials that are added in small amounts,

which are designed to add a specific feature of the paint and improve the

application, examples of additives are wetting agents, film-formation

promoters, levelling agents.

• Solvents are chemicals materials that make the paint a liquid material and fluid

with a specific viscosity. The main purpose of the solvent is to adjust the

viscosity of the paint.

• Thinners - are chemicals materials that allow changing the viscosity of the

paint according to the conditions land means of application, the main

difference is that the solvents do not dissolve to the paint.

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• Hardeners - are chemical compounds that react with the resin, producing the

formation of the polymer and hence jthe solidification of the paint, are paints

which do not require hardener, curing or solidification occurs by the action of! ■

humidity, the application of ultraviolet light, etc.j

• Catalyst - are chemical compounds that accelerate the curing or solidification

process of the paints, also called as accelerators or dryers.i

IThe success of a good paint job lies in respecting and select each of the appropriate

techniques in each of the stages of painting, nothing will serve all effort, time andi

money invested in a paint application process if the surface preparation not do in

accordance with the requirement to fulfil, due all work is ruined when problems such

as adhesion failure of paint applied on the surface.

I

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5.5 CLASSIFICATION OF PAINT:

I

With technological advancements, the traditional classification of paints into either

enamel or emulsion has become misleading. Today, the industry has enamel paints

that can be diluted with water and emulsion paints that have smooth, glossy finishes.

Hence, it becomes essential to identify paint by its resin components to minimise

contusion.

Appendix A shows some examples of paints classified by their resin components and

properties. In general, “enamel” refers to solvent-based Alkyd resin which is

generally used for wood and metal surfaces. Apart from classifying paints by their

resin components, paints may also be classified in accordance with their curing

mechanism, solvent used, function and market segment as shown in Table.

ts

Chart No: 15. Classification of Paints

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5.6 PROPERTIES OF PAINT:

The properties of paint determine the general quality of the coating and its

workability, ease of application and resistance characteristics. Table itself shows some

basic properties of paints.

111.,v- 0 mm

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0

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Chart No: 16.Properties of Paints

5.7 CHALLENGES FACED BY THE INDIAN PAINTS INDUSTRY:j

Today Indian Paints Industry is facing various challenges. They are as follow:

1) Exterior paint is the fastest growing segment in the Indian paint market.

Advertising, sales promotions, brand equity, a wide range of shades, distribution

strength and efficient working capital management are key success factors in the

exterior paints segment It is a raw material- intensive business with cost of material

accounting for 69 per cent of total expenses and 54 per cent of net sales. Demand for

exterior paints is not price-sensitive and unlike other segments it is not cyclical.

Growth is more than proportionate to the economical growth of India. The estimate is

that an eight to nine per cent growth in India on a long-term basis will result in a 15-

20 per cent growth in the exterior paints segment.

2) In the past, a critical challenge in the paints industry was the competition from the

unorganised players; who were not liable for excise as well as other taxes. Reduction

of excise duties over the last few years, from 40 per cent to the present level of 12 per

cent, has helped create a level playing field between the unorganised and organised

segments. As the unorganised sector loses its competitive edge, it is also losing

market share to the organised sector players. The customers too are demanding

quality products from well established brands.

3) The increased purchasing power in India is leading to an increase in repainting

activity. The Indian consumer has shifted from lower quality to premium quality

paints. This segment is not too seasonal and 60 per cent of the demand for exterior

paints stems from repainting. Rising aspirations, redevelopment and refurbishment of

homes leads this market to grow consistently. It is a shift in the perception of paints,

having protective qualities that in addition to decorative one have diminished the

impact of seasonality. Paint units have always been a household name for premium

quality paints so low-cost or project quality paints are no longer a challenge.

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4) Due to globalization, large numbers of projects are managed by international

consultants who recommend "paint specifications" of different types meeting

requirements of specific projects. Paint industry has products within several segments

such as zero-VOC waterproof cement paints, premium low-VOC exterior emulsions:

with solar-reflective properties, with quartz aggregates or with silicone which address

the need of different surfaces and project specifications.

5) A11 paints and products have been water-based, free from lead, mercury and

chromium from inception and the current fashionable trend of green paints has always

been part of the company’s ethos.

6) Boom in the Indian Housing Sector - The increasing availability & easy finance for

houses, driven by faster growth in the incomes of middle- and higher-income

categories, increasing urbanization, and a shift from semi-permanent to permanent

housing structures, have been driving growth in the exterior paints segment.

7) Strong industrial growth and heavy infrastructure spending, new projects pertaining

to roads, ports and industrial segments is a positive sign encouraging international

brands to step into India. This has further put the industry in the spotlight and

increased consumer awareness towards quality products.

8) The retail segment plays an important part in the exterior paints business. Paint

industry has a well established national distribution chain with other distributors,

dealers and retailers pan-India. Many of these dealers are third generation. To build

such a distribution network would always be a challenge for new entrants and has

been a key competitive strength for paint industry.

9) Distribution reach is important for growth and further more servicing them

consistently and on time will further help speed up the penetration levels. Currently it

main is only timely servicing is the biggest challenge.

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5,8 LIST OF SELECTED PAINT UNITS OF GUJARAT:

Sr.

No.

Company Name City

1 Indian Paints Mehsana

2 Rasna Paints Mehsana

3 Vimal Paints Mehsana

4 Welcoat Paints Mehsana

5 Nippon Paints Ahmedabad

6 Esdee Paints Ahmedabad

7 Nerolac Paints Ahmedabad

8 Asian Paints Ahmedabad

9 Berger Paints Ahmedabad

10 Share willaim Paints Ahmedabad

11 Aura Paints Ahmedabad

12 Akzonable Paints Ahmedabad

13 Rosalkyd Paints Anand

14 Delight Paints Anand

15 Bee Pee Coatings Anand

16 Pacific Paints Anand

17 Rado Paints Anand

18 Champion Paints Anand

19 Moonlight Paints Anand

20 Tirupati Paints Anand

21 Packmee Industries Anand

22 Bharat Paints Baroda

23 Britiesh Paints Baroda

24 Snowcem Paints Baroda

Chart No: 17. List of Selected Paint Units in Gujarat

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