Asian Paint at Good Value Buying Zone !!

Asian Paints is the largest home decor company in India. The 80 yyr old company has major brands like Asian Paints, Berger, Apco, etc under its umbrella. The co. is into wall paints, wall coverings, waterproofing, texture painting, wall stickers, mechanized tools, adhesives, modular kitchens, sanitaryware, lightings, soft furnishings, and uPVC windows.

Business Segments

1) Decorative Business (~84% in Q1 FY25 vs 88% in FY22): [1] The company offers interior and exterior wall finishes, waterproofing, wood finishes, enamels, adhesives, and more. It also includes a home decor business that offers modular kitchens and wardrobes, bath fittings and sanitaryware, and decorative lighting. etc Home decor contributes approximately 4% to the decorative revenue. [2] [3]

2) International Business (7% in Q1 FY25 vs 10% in FY22): [4] The company operates in 14 countries spanning across 4 regions globally. It serves 60+ countries. [2]

Q1 FY25 revenue split:
Asia: ~38%
Middle East: 37%
Africa: ~22%
South Pacific: 3%[5] [4] [6]

3) Industrial Business (9% in Q1 FY25 vs 2% in FY22): [7] The company operates in the industrial coatings segment through a 50:50 joint ventures with PPG Industries Inc. It offers custom-formulated products for the automotive and industrial sectors, including automotive, marine, and packaging coatings, as well as industrial protective coatings. [8] [2]

Brands
Asian Paints, SCIB Paints, Apco Coatings, Asian Paints Berger, Taubman, Asian Paints Causeway, Kadisco Asian Paints, Weather Seal, etc. [2]

Market Leadership
The company is the largest paint company in India, 2nd largest in Asia, and 8th largest in the world. [9] It holds a market share of over 55% in the organized domestic paints market, 60% in the decorative paints segment, and 20% in the automotive industrial coatings segment. [10]

Revenue and Profitability
FY24 saw a moderation in demand due to retail inflation, particularly in rural markets, leading to a slowdown in revenue growth to single digits. Despite this subdued revenue growth, the company achieved strong profit growth, supported by declining raw material prices and various internal cost optimization initiatives. [11]

Sales & Distribution
As of FY24, the company has over 1,60,000 retail touchpoints in India. It operates 60 Beautiful Home stores and has over 2,67,000 business influencers and a supplier base of more than 21,000. [2] [12] [13]

**Manufacturing Facilities **
The company has 17 manufacturing facilities outside India and 18 manufacturing facilities within India.[14] It also has 28 outsourced processing centers. [13] As of Q1 FY25, it has an installed paints capacity of ~22 Lakh KLPA. [15]

Capacity Expansion
In FY23, the company announced investments of ₹8,750 Cr over the next three years for capacity expansion through brownfield (5.4 Lakh KLPA across Kasna, Khandala, Ankleshwar, Mysuru) and greenfield (4 Lakh KLPA in MP ) projects taking total manufacturing capacity to 26.7 lakh KLPA from 17.3 Lakh KLPA. Khandala (Maharashtra) and Kasna (UP) brownfield expansions have been completed, augmenting capacity by 1.2 Lakh KLPA by FY24. MP greenfield project is expected to be completed in 2028. [16] [17] In Q1 FY25, it also completed expansion of Mysuru plant from 3 Lakh KLPA to 6 Lakh KLPA. [18]

R&D
The company had filed 142 patents by FY24, of which 72 have been granted including 19 granted in FY24. During FY24, the company launched 24 new products in the decorative paints business and 16 in the industrial paints business. It spent approximately ₹120 Cr in FY24, compared to ₹93 Cr in FY22 towards R&D" [19] [20]

Debt
As of FY24, the total consolidated debt of the company has increased to Rs. ~2,470 Cr from Rs. ~1,600 Cr in FY22. [21]

Focus
The company is focused on scaling up its industrial businesses and further strengthening its home décor categories. [22] It targets to increase the share of Home Decore business to 8%-10% of Decorative business in the next 3 years. [23] It is adding ~18-20 beautiful home stores every year. [24]