ACKNOWLEDGMENTS

We would like to thank many people for their

pleasant cooperation and support in duration of
completing my project. First, we extend thanks
to Prof. Pravin Patil for being my mentor. We
would like to thank him for allowing me to work
on this project.

We also want to thank our friends who helped us

on the project and giving us ideas about making
this project valuable.

We have learnt much about the business

strategy perspectives and much more.

The report has helped us to enrich our

knowledge about new market development and
expansion strategy of a company. Apart from
that we learnt to evaluate the existing brand
equity, measures to improve its brand value and
different marketing strategies.

1. INTRODUCTION
Asian Paints is India's largest paint company and ranks among the top
ten decorative coatings companies in the world today. Over the course
of 25 years Asian Paints became a corporate force and India's leading
paints company. Driven by its strong consumer-focus and innovative
spirit, the company has been the market leader in paints since 1968.
Today it is double the size of any other paint company in India. It has
also drawn on the world's latest technology for its manufacturing
capabilities in areas like powder coatings and high-tech resins - thus
ensuring that its product quality lives up to exacting international
standards, even in the most sophisticated product categories. The
company places strong emphasis on its own in-house R&D, creating
new opportunities by effectively harnessing indigenous creativity.
Asian Paints operates in 23 countries across the world. It has
manufacturing facilities in each of these countries and is the largest
paint company in nine overseas markets. It is also India's largest
exporter of paints, exporting to over 15 markets in the Asia-Pacific
region, the Middle East and Africa. In 12 markets it operates through
its subsidiary, Berger International Limited and in Egypt through SCIB
Chemical SAE.
Asian Paints announced that it would focus on emerging markets of the
world for growth and also that Berger International will be the main
growth driver for Asian Paints international operations.

Asian Paints aims to become one of the top five Decorative coatings
companies world-wide by leveraging its expertise in the higher growth
emerging markets. Simultaneously, the company intends to build long
term value in the Industrial coatings business through alliances with
established global partners.

The Group operates in Australia, Fiji, Solomon Islands,

Tonga, Vanuatu, Myanmar, China, Thailand, Malaysia, Singapore,
Bangladesh, Nepal, Srilanka, Bahrain, the UAE, Oman, Barbados,
Jamaica, Trinidad, Tobago, Egypt, Mauritius and Malta.
 2. COMPANY
HISTORY

The company has come a long way since its small beginnings in 1942.
Four friends who were willing to take on the world's biggest, most
famous paint companies operating in India at that time set it up as a
partnership firm. Over the course of 25 years Asian Paints became a
corporate force and India's leading paints company. Driven by its
strong consumer-focus and innovative spirit, the company has been the
market leader in paints since 1968. Today it is double the size of any
other paint company in India. Asian Paints manufactures a wide range
of paints for Decorative and Industrial use.

Vertical integration has seen it diversify into products such as Phthalic

Anhydride and Pentaerythritol, which are used in the paint
manufacturing process. Asian Paints along with PPG Inc, USA, one of
the largest automotive coatings manufacturers in the world has begun
a 50:50 joint venture, Asian PPG Industries to service the increasing
requirements of the Indian automotive coatings market. Another wholly
owned subsidiary, Asian Paints Industrial Coatings Limited has been
set up to cater to the powder coatings market which is one of the
fastest growing segments in the industrial coatings market. This
wholly owned subsidiary of Asian Paints has entered into a tie-up with
Canada-based Protech Chemicals which is one of the top ten powder
coatings companies in the world for technological know-how in the
area of powder coatings.

Chimanlal Choksi, Champaklal Choksey, Suryakant Dani and Arvind

Vakil were the four friends who started the company. Chimnalal Choksi
was a painter whose daughter had died. Chimanlal Choksi was unable
to save her because of financial problems. Champaklal Choksey had
been thrown out of his house as his parents caught him selling
household things at a huge margin to British officials. Suryakant Dani
owned a Garage where he did the painting work for Machines &
Vehicles. The same garage is where Asian Paints started off its
operations. Arvind Vakil was a worker who did the painting work bi-
cycles for Suryakant Dani. Around 1991 the company refused to
acquire Moser-Baer saying it had no future.

1945

- The Company was incorporated as a private limited company under

The name of Asian Oil and Paint Company Pvt. Ltd. It was converted
into a public limited company in 1973. The Company manufactures a
wide range of surface coatings catering to different end-uses. It also
Manufactures vinyl pyridine latex used in the manufacture of rubber
Tyres.

- The company expanded its products range, developed its own

technology, set up a distribution network penetrating in smaller
towns and ploughed back a large part of earnings into creation of new
facilities.

1965

- The name was changed from Asian Oil and Paint Company Pvt. Ltd.
To Asian Paints (India) Pvt. Ltd.

1974

- A major modernization programme was undertaken to streamline the

Paint production facilities by improving the layout of machines,
addition to balancing equipment and replacement of old machinery.
The Company embarked on phased modernization of resin
manufacturing facilities as well.

- The Bhandup plant of the Company is reportedly the largest single

paint factory in the country and one of the most up-to-date with
sophisticated machinery and equipment for manufacturing a wide
range of paints and other products besides adequate resin
manufacturing capacity to meet its entire requirements.

1978

- 1, 00, 000 Bonus Equity shares issued in the prop. 2:3.

1980

- 50,000 unclassified shares classified as preference shares and

issued. They are redeemable during the period 30.6.1987/1990.

1982

- The main objects of the public issue of capital during August,

Were to fulfill the listing requirements of the Stock Exchange and to
provide part of the finance for the increased operations.

1983

- Equity shares subdivided. 10, 00,000 Bonus shares issued in prop.

2:5, 16, 85,185 No. of Equity shares issued (prem. Rs 13 per share)
through prospectus in August 1982. Out of these, 84,259 shares and
33,704 shares were reserved for preferential allotment to the
Employees and to the business associates of the company
respectively. 15, 67,222 shares offered to the public of which 4, 21,296
shares were offered to NRIs on repatriation basis.
1985

- The Company undertook to set up a third paint unit at Patancheru,

A notified backward area near Hyderabad, for the manufacture of
15,000 MT of paints and enamels.

- A letter of Intent was obtained for setting up a fourth paint

Plant in Uttar Pradesh with a capacity of 23,000 tonnes per annum of
Paints, varnishes and enamels and 65,000 tonnes per annum of
synthetic resins (for captive consumption).

- The Company entered into a collaboration agreement with Nippon

Paints Co. Ltd., Japan, to obtain technical know-how to manufacture
powder coating and coil coatings under an exclusive license.
Necessary manufacturing facilities for the powder coatings with a
capacity of 300 MT were installed and commissioned at Kasna plant
during 1992-93.

- 31, 11, 111 Bonus equity shares issued in prop. 3:5.

1987

- The Company commissioned a plant for the manufacture of synthetic

rubbers lattices with a capacity of 1,200 tonnes per annum. The
Company received a letter of intent to manufacture 9,000 tonnes of
phthalic anhydride. The project would be based on imported Van
Heyden low energy process technology with engineering package from
Davy McKee of Cologne, West Germany. The project was
commissioned in March 1990.
But, a fire accident in the succeeding month damaged a storage tank,
Nearby pipes and support structures. The plant was repaired and
restarted only in August 1990.

- The Company jointly with Tamil Nadu Industrial Development

Corporation (TIDCO) promoted a joint sector Company under the name
Pentasia Chemicals Ltd. (PCL), for the manufacture of 3,000 TPA of
pentaerythritol and 1,800 TPA of sodium formate. The project
commissioned in March.
 - 41, 48,148 Bonus equity shares issued in prop. 1:2.

1988

- The Company issued 9, 00, 000 - 14% secured non-convertible

Debentures of Rs 100 each to ICICI, UTI, LIC, GIC, NIC, New India
Assurance Company Ltd., Oriental Insurance Co., Ltd and United India
Insurance Co., Ltd. on private placement basis. These debentures are
redeemable in five equal instalments on the expiry of 5th, 6th, 7th, 8th
and 9th year from the date of allotment at a premium of Rs 5 per
debenture.

1989

- A scheme of arrangement was finalised for vesting of the assets

And liabilities of the Company's Apcotex division with Apcotex Lattices
Ltd. (ALL). As per the scheme of arrangement, one equity share of
Rs 10 each of ALL was allotted without payment in cash to the
Shareholders of Asian Paints (India) Ltd., for every 13 equity shares
held by them in the company, i.e., Asian Paints (India) Ltd.

- The first phase of the project with an initial installed capacity

Of 16,000 tonnes per annum was commissioned during the year.

1990

- Asian Paints (South Pacific) Ltd., in Fiji and Asian Paints

(Tonga) Ltd., are two joint venture set up abroad with the Company
supplying the necessary know-how. Both these are the Company's
subsidiaries and the equity participation by the Company amounted to
51% in the former and 25% in the latter as at 31st December. Asian
Paints (South Pacific) Ltd., holds an additional 25% in the equity capital
of Asian Paints (Tonga) Ltd.

- The Company also set up two more joint ventures under the names
And styles of Asian Paints (Nepal) Pvt. Ltd., and Asian Paints (S.I.)
Ltd., both of which are subsidiaries of the Company.

- The Company had set up a joint venture unit Asian Paints (Vanuatu)
Ltd., for the manufacture of paints and enamels in the Pacific
Island of Vanuatu. The Vanuatu company had issued 54,000 ordinary
shares of US each to the Company as fully paid-up shares against the
plant and machinery supplied.

1991

- Pentasia Chemicals Ltd. became a subsidiary of the Company.

Pentasia Investments Ltd. is a subsidiary of the Company.

- The Company acquired 19, 10,000 equity share of Rs 10 each in the

Share capital of Pentasia Chemicals Ltd., from TIDCO in May.
Consequently, PCL became a subsidiary of the Company.

- The Company issued 5, 00,000 - 17.5% secured non-convertible

redeemable debentures of Rs 100 each aggregating to Rs 500 lakhs to
Unit Trust of India on private placement basis. These debentures
Are redeemable in three equal instalments on the expiry of 6th, 7th and
8th years from the date of allotment at a premium of Rs 5 per
debenture.

1992

- 74, 66,666 Bonus equity shares issued in prop. 3:5.

1993

- Sales of phthalic division was lower due to planned shutdown of

The plant for 25 days and also due to lower selling prices.

- The Company undertook to set up a joint venture unit along with

Its overseas subsidiaries, in Queensland, Australia for manufacture of
paints, enamels and varnishes.
1994

- The Company proposed to expand its existing capacities for the

manufacture of paints and enamels to 50,000 tonnes per annum at
each of its plants in Ankleshwar, Patancheru and Kasna.

- The Company placed before the operating agency approached by

BIFR, the proposal to amalgamate with itself Pentasia Chemicals Ltd.

1995

- Pantasia Chemicals Ltd. (PCL) was merged with the Company. The
assets and liabilities of the erstwhile PCL are vested with the
Company with effect from 1.10.1994.

- The company undertook to set up a joint venture unit for the

manufacture of paints, enamels and varnishes in the Republic of
Mauritius. The joint venture involves a total cost of 1, 83, 00,000
Mauritius Rupees of which 49% will be financed by the Company and
The balance from Mauritian parties.

- 199,11,110 No. of Equity shares allotted as bonus shares on

1.1.1996. Another 2, 94,000 No. of Equity Shares of Rs 10 each were
allotted by the Company in pursuant to the order of BIFR to PCL in
prop. 1:25.

1996

- The Company proposed to set up a fifth point manufacturing plant

At Ratnagiri, Maharashtra.

- During 21st February, a fire broke and in the paint manufacturing

block of Mumbai plant causing extensive damage to the materials
stored in the block.

- A joint venture company viz. Asian PPG Industries Pvt. Ltd. was set
Up along with PPG Industries, Inc. of USA to market and/or
manufacture automotive paints and certain Industrial products as may
be decided upon mutually between the partners.

1998

- As at 31st March, a sum of Rs 1008 lakhs was outstanding against

loans from Financial Institutions.

- The new initiative to install 350 colourworlds received

Encouraging response and made significant contribution to
performance. Three new products, NC range of wood finishes, ACE
exterior emulsion and Asian wall putty were launched.

- Asian Paints, the Rs.737.20 crore paints major, has launched a new
marketing thrust with the introduction of a one-stop colour shop for
paints complete with a software for consumers to choose and select
their different shade combinations.

- Asian Paints, India's No.1 Paint Company recently, launched their

latest offering `Asian Paints Colour World'.

- Credit Rating Information Services of India Ltd (Crisil) has

Assigned a `AAA' rating to the proposed non-convertible debenture
(NCD) obligation of Asian Paints Ltd (APL).

- Two subsidiaries of Asian Paints - Pentasia Chemicals and Pentasia

Investments - have been merged with the parent company following the
approval of the Board for Industrial & Financial Reconstruction
(BIFR).

- Asian Paints Limited, the largest paint company in India, launched

Its first exclusive showroom in Mumbai.
1999

- The company has joint venture companies in the overseas market.

All these ventures are doing well and have a strong hold in their
respective markets.

- In its first-ever acquisition overseas, Asian Paints Ltd (APL) has

acquired a 76 per cent equity stake in Sri Lanka-based Delmege
Forsyth & Co (Paints) Ltd.

2000

- Asian Paints has launched two variants in polyurethane (PU) wood

finish under the brand name Opal.

- The Company has proposed to issue bonus shares in the ratio of

Three shares for every five shares held.

- Asian Paints has opened a manufacturing plant in oman in

Partnership with a local company.

- Asian Pains has acquired the entire paints business of Pacific

Paints Company based in Australia for over Rs 1 crore.

- Asian Paints has lifted the lockout at its factory in Uttar

Pradesh. The Company suspended operations at Kasna in July after the
workers resorted to a sit-in-strike.

2001

- Asian Paints has introduced Utsav Enamel for the festive season.

- Asian Paints has appointed senior parnter of the solicitor firm

Crawford Bailey & Co, R A Shah and Deputy Director, National
Chemical Laboratory Dr Swaminathan Sivaram as directors on the
company's board.

- Asian Paints India Ltd has posted a marginal drop in net profit at
Rs 29.62 crore for the quarter ended September 30, 2001.

2002

-Approves voluntary delisting of shares from the following stock

exchanges:

1. The Ludhiana Stock Exchange Association Ltd.

2. The Calcutta Stock Exchange Association Ltd.

3. The Stock Exchange, Ahmedabad

4. Madras Stock Exchange Ltd

5. The Delhi Stock Exchange Association Ltd.

6. The Hyderabad Stock Exchange Ltd.

7. Vadodara Stock Exchange Ltd.

-Revamps its international operations, transferres shares in its

subsidiaries in Fiji, Tonga, Solomon Island, Vanuata, Australia and
the Sultanate of Oman to the Mauritius based subsidiary Asian Paints
International

-Executes agreement for purchase of 60% equity capital of SCIB

Chemicals S.A.E., Egypt

-Launches its million joint venture with Bangladesh-based

Confidence Cements in which the holds 51 per cent stake

-Acquires controlling stake of 50.1 per cent in Berger International,

Singapore, for Rs 58 crore, appoints Jalaj Dani as CEO.
2003

-Board recommends issue of bonus shares by capitalisation of

Reserves in the ratio of 1 equity share for every 2 equity shares held on
the record date.

-Asian Paints, via its Singapore-based subsidiary - Berger

International - inks a technology and brand licensing agreement with
PT Abadi Coatings Solusi, an Indonesian paint company.

-Shareholders approve the Scheme of Arrangement proposed to be

made between Pentasia Investment Ltd with Asian Paints India Ltd and
the consequential reduction of share capital of Asian Paints India Ltd.

-Berger International starts restructuring exercise to curtail cost.

-Acquires Taubmans Paints (Fiji) Ltd. through its subsidiary in Fiji,

Asian Paints (South Pacific) Ltd. (APSP).

-Acquisition of 9.2% shares in ICI India Ltd.

-Asian Paints bags Ken Sharma award.

2004

-10th Asian Paints Star Screen Weekly Awards- aura of mystery

-Asian Paints launches paint solutions for kids.

2005
-Berger Intl partners with Filipino firm Dutch Boy.

10. INTERNATIONAL
OPERATIONS

Asian Paints operates in 22 countries across the world, which

accounts for 30% of its sales. It has manufacturing facilities in each of
these countries and is the largest paint company in ten overseas
markets. Asian Paints operates in five regions across the world viz.
South Asia, Southeast Asia, South Pacific, Middle East and Caribbean
region through the five corporate brands viz. Asian Paints, Berger
International, SCIB Paints, Apco Coatings and Taubmans. In ten
markets, it operates through its subsidiary, Berger International
Limited; in Egypt through SCIB Paints; in five markets in the South
Pacific it operates through Apco Coatings and in Fiji and Samoa it also
operates through Taubmans.

The countries that Asian Paints has presence are as follows:

South Asia: Bangladesh, Nepal, and Sri Lanka

South East Asia: China, Malaysia, Singapore and Thailand

Caribbean Islands: Barbados, Jamaica, Trinidad and Tobago

Middle East: Bahrain, Egypt, Oman and United Arab Emirates

South Pacific: Fiji, Solomon Islands, Samoa Islands, Tonga and Vanuatu

The company's global operations have now turned profitable with the
potential to accelerate growth further, according a leading securities
research firm. The turnaround in international operations will further
leverage the overall profitability of the company. Strong domestic sales
growth and accelerating profitability of foreign operations will make
the company show earnings growth of 25 per cent over FY04-06E.

Asian Paints is the market leader in India's decorative paints industry,

accounting for 46 per cent of the total revenues of the top six players
in the organized segment. The company caters to the industrial paints
segment through its subsidiary APICL and Asian Paints PPG, a joint
venture with US-based PPG Industries.

Also, the company is poised to capitalize on domestic market growth,

the leading foreign analyst firm said. It is expected that increasing
urbanization, higher disposable incomes, cheaper housing loans and a
shift from semi-permanent to permanent housing structures will be
driver for growth in the paint business.

Although it is expected that the bulk of the demand for paints will
come from the housing sector the industrial paints segment is also
growing. Asian Paints enjoys competitive advantages that should help
it outpace the market - strong brands, a wide range of offerings across
all product categories, and the most extensive distribution network in
the paints industry. The company has strong brands across various
segments of a category.

In the wall finishes category, it has brands from the premium (Royale)
to the lower end (Tractor). Through innovative advertising and
products, the company has created new segments for growth. Until
recently, most exterior paints in India were cement paints.

However, over the past few years, Asian Paints has created a market
for exterior paints, underpinned by strong marketing and distribution.
The results have been encouraging, with volumes growing much faster
than the overall sector growth, the analyst said.

In the industrial paints segment, Asian Paints has a presence in

automotive, powder and protective coatings. The automotive and
powder coating segments are serviced through Asian PPG Industries
and wholly owned Asian Paints Industrial Coatings (APICL)
respectively.
 3. BOARD OF
DIRECTORS

Mr. P. H. MURTY (Managing director and CEO)

Mr. ASHWIN CHOKSI (Non-executive chairman)

Mr. ASHWIN DANI (Non-executive vice chairman)

Mr. ABHAY VAKIL (Director)

Mr. MAHENDRA CHOKSI (Director)

Mr. AMAR VAKIL (Director)

Mr. HASIT DANI (Director)

Ms. TARJANI VAKIL (Chairperson of audit committee)

Mr. DEEPANKAR BASU (Director)

Mr. MAHENDRA SHAH (Director)

Mr. DEEPAK SATWALEKAR (Director)

Mr. RAJENDRA SHAH (Director)

Dr. S. SIVARAM (Director)

 6. MANUFACTURING
FACILITIES
Asian Paints is proposing to set up, subject to obtaining necessary
approvals and licenses, a unit for the manufacture of 100,000 tones per
annum (TPA) of paints in Pondicherry.

The proposed plant, subject to approvals, will be Asian Paints' largest

plant in the world and would be the most state-of-the-art plant set up
by the company. The Pondicherry plant will be scaled to its full
capacity over a period of time and the investment in the mentioned
project will also be made in a phased manner.

Asian Paints has four paint manufacturing units in India. These units
are situated in Bhandup (Maharashtra), Ankleshwar (Gujarat),
Patancheru (Andhra Pradesh) and Kasna. The company has two
facilities as part of its backward integration process. It has a factory
at Ankleshwar that manufactures phthalic anhydride and in Cuddalore,
Tamil Nadu, which manufactures pentaerythritol.

All the company's paint plants have been certified for ISO 9001 and
have also received the ISO 14001 certificate for Environment
Management Standard. The phthalic anhydride plant has been certified
for ISO 9002 and ISO 14001 whereas the pentaerythritol plant has been
certified for ISO 14001.
Asian Paints along with its subsidiaries has operations in 20 countries
across the world and 28 paint manufacturing facilities, servicing
consumers in 65 countries through Berger International, SCIB Paints-
Egypt, Asian Paints, Apco Coatings and Taubmans. Asian Paints
operates in 5 regions across the world viz. South Asia, South East Asia,
South Pacific, Middle East and Caribbean region through the five
corporate brands viz. Asian Paints, Berger International, SCIB Paints,
Apco Coatings and Taubmans. In 10 markets, it operates through its
subsidiary, Berger International Limited; in Egypt through SCIB Paints;
in 5 markets in the South Pacific it operates through Apco Coatings
and in Fiji and Samoa it also operates through Taubmans.

No of
Co untrie s Op er atin g Com pa ny
Facilitie s
Sout h Asia
India 8 Bhandup, Ankleshwar, Patancheru, Kasna,
Sriperumbudur, Sarigam, Baddi, Taloja
Sri Lanka 1 Asian Paints
Nepal 1 Asian Paints
Bangladesh 1 Asian Paints
Sout h E ast Asia
China 1 Berger International
Malaysia 1 Berger International
Singapore 1 Berger International
Thailand 1 Berger International
Sout h P acifi c
Tonga 1 Asian Paints
Fiji 2 Asian Paints Fiji, Taubmans Fiji
Samoa Islands1 Taubmans
Vanuatu 1 Asian Paints
Solomon 1 Asian Paints
Islands
Mid dle East
Oman 1 Berger International
Bahrain 1 Berger International
Dubai 1 Berger International
Egypt 1 SCIB Paints
Carib be an
Jamaica 1 Berger International
Barbados 1 Berger International
Trinidad & 1 Berger International
Tobago
Tot al 28

7. SUPPLY CHAIN

Asian Paints has harnessed the powers of state-of-the-art supply chain

system using cutting edge technology to integrate all its plants,
regional distribution centres, outside processing centres and branches
in India. All the company's paints plants in India, two chemical plants,
18 processing centres, 350 raw material and intermediate goods
suppliers, 140 packing material vendors, 6 regional distribution
centres, and 72 depots are integrated.

The supply chain runs through a wide spectrum of functions right from
materials planning to procurement to primary distribution. It has played
a pivotal role in improving operational efficiencies and creating agile
procurement, production and delivery systems. It has also enhanced
the flexibility of operations, lowered output time and reduced delivery
costs, while improving customer-servicing levels and profitability.

The Supply Chain Management is backed by IT efforts that help the

company in demand forecasting, deriving optimal plant, depot and SKU
combinations, streamlining vendor relationships, reducing procurement
costs and scheduling production processes for individual factories.

14. HUMAN RESOURCE

Asian Paints believes that people are its strongest assets, for a
company can go only as high as its people aim. It is people who
innovate and invent, and who engineer the efficiencies that make a
business succeed. It is they who drive growth and lead to greater
heights. At Asian Paints, our human resources systems are designed to
create a focused, performance oriented and agile company. A talent
pool of over 4700 employees employed across 23 countries brings in a
unique blend of mindsets and skills.

An open and interactive work culture brings out the best in our people.
A sense of ownership and freedom to experiment at their workplace
brings out creativity and innovation in every individual. Excellent
training is provided to develop leaders and re-strengthen competencies
from within the organization. Besides encouraging achievers from
within the organization, we absorb the best talent from some of the
best management and technology institutes in the country.

We hire people who are best suited to the job and whose personal
goals are in alignment with our corporate purpose. Thus, the task is
cut out for every individual within the framework of result-orientation,
market insight, customer perspective, trust, respect and problem
solving.

The commitment of our people and their sense of discipline and

ownership continue to drive growth for our company.

8. RETAIL
INITIATIVES

Customers are the very core of all business activities. From the
beginning, Asian Paints has fostered a customer-centric approach to
business. A simple but unbeatable concept of "going where the
customer is" drives all the retail strategies.

In the early 90s, for the first time in the paint industry Asian Paints
offered the consumer over 150 shades. The concept was extended to
the dealer shops through Colour World in the mid-90s, where Asian
Paints began offering over 1000 shades. The introduction of Colour
World provided a new direction for the paint industry into the age of
retailing by providing the consumer - a service interface. With only a
limited set of bases and colourants, manufactured and transported
throughout the supply chain, Asian Paints provided a choice of
innumerable shades to the customer through a technology of tinting at
the last retail store.

With the introduction of Colour World, almost all wall-finishes from

Asian Paints offer a wide range and choice in colours be it for interior
or exterior application. It has been our endeavor to reach out to the
customers not only with their products but also with value-added
services and initiatives.

The Asian Paints Helpline introduced few years ago is a toll free
service where consumers call and ask queries related to painting. The
company has now extended this service to ASIAN PAINTS HOME
SOLUTIONS, which offers painting services in addition to the paint.
This service is available in 10 cities viz - Hyderabad, Bangalore,
Kolkata, Delhi, Chennai, Ahmedabad, Mumbai, Pune, Coimbatore &
Cochin.

The company entered into a new foray of prediction of colour trends in

India. Intensive research is carried out with interior designers,
architects and the fashion community to arrive at trend movements in
colour each year. The study being done for the second year is termed
ColourNEXT 2006, which is a collection of 15 shades predicted to be
the trendiest and most happening colours in decor space in 2006.

This study has helped consumers get an insight into the latest trends
in colour. This exercise has also gone a long way in helping various
industries decide their colour combinations for a range of products
ranging from furnishings, floorings to home accessories.

Another important area was the offer of painting solutions for children
with the launch of Kids World. A foray into Kids' World marks yet
another milestone wherein the company offers painting designs for
Kids Rooms as well as Kids Corners. For the first time, an attempt has
been made to invite the customer to get into a Do-It-Yourself mode
with these designs. Royale Play is another innovative concept
introduced by the company. It is a collection of innovative and ready-to-
use special effect finishes for interior walls, comprising a range of
special effects. And each of these effects is available in a shade
palette that is fitting for that effect in interesting colour combinations.
The revolutionary product gives wall paint a whole new usage. Now,
along with colour, you can give your walls dimension, texture and life.
Asian Paints efforts are continuously on to engage the consumer in the
painting process and fulfill all the requirements related to the world of
painting.

11. INFORMATION
TECHNOLOGY
Information technology (IT) plays a key role in enabling the company to
grow and generate profits. Asian Paints is the only company in India to
have integrated Supply Chain Management (SCM) Solution from i2
Technologies, and Enterprise Resource Planning (ERP) solution from
SAP. With these IT tools firmly in place and with the backing of an
extensive communication platform, we are an internally enabled
enterprise. The road ahead is to integrate all our stakeholders
including suppliers, employees and customers and create an extended
enterprise.

Asian Paints has launched a supplier portal that includes an automated

digital document exchange facility that will improve the efficiency and
effectiveness of interaction with suppliers. An employee portal has
also been set up. Customer Relations Management (CRM) tools are
being used in Asian Paints Helpline and Home Solutions initiatives.

The successful deployment of ERP, CRM, Business Intelligence and

Portal software from leading solution providers and integrated SCM
systems has helped improve efficiency in the business as well as
increase the transparency and accuracy of information across the
company. In order to affect 24x7 availability of our IT infrastructure,
we are setting up a disaster recovery site in South India.
To match the pace of growth of our international business, we are
focusing on improving transaction systems and messaging platforms.
Implementing of a portal platform for improved collaboration and
sharing of information across all geographies is already underway.

12. RESEARCH AND

DEVELOPMENT

At Asian Paints, Research and Development (R&D) plays an important

role in developing new products and innovations, and reducing costs by
value re-engineering of formulations.

In India, the company's 140 strong R&D team consisting of 7

doctorates and around 115 qualified scientists, has always backed the
company's business plan and demands of the market place. Right from
the company's inception, all its decorative products for the Indian
market and also in the overseas market have been developed in-house.
In the last few years, our R&D efforts have been focused on developing
new exterior finishes, economy emulsions and distempers.

Asian Paints' R&D team has successfully managed to develop High-end

exterior finished and wood finishes in-house, which was earlier
imported into the country. These products are currently marketed
under Asian Paints Elastomeric Hi-Stretch Exterior paint and Asian
Paints PU wood finish respectively.
The R&D team also provides technological support and develops
customised products for the company's international operations
spanning across 19 countries.

The company is also in the process of setting up new a new R&D

centre near Mumbai (India).

13. ENVIRONMENT
AND SAFETY

Asian Paints approaches the environment issue from the perspective of

waste minimisation and conservation of resources. Thus, the
continued attempt is to reuse, recycle and eliminate waste, which
results in less and less waste being generated. Accordingly, their
material losses in manufacturing have been reduced substantially over
the last few years.

Further, the company's four paint plants and the two chemical plants
have the ISO 14001 certification for environment management
standards. The company's latest manufacturing facility which is
situated at Sriperumbudur near Chennai will be certified for ISO 14001
in this financial year 2006-07.

All their paint plants have achieved 'zero industrial discharge'

capability. This has been achieved by the installation of upgraded
effluent treatment facilities and installation of reverse osmosis plants
in conjunction with appropriate recycling and reuses schemes. Their
emulsion manufacturing facility has also achieved 'zero waste' status.
They have adopted the principles of "green productivity".

Some of their innovative schemes which enhance green productivity

are dealer tinting systems which has resulted in large batch sizes ;
bulk storage facility for monomers which reduces wastage; Use of
natural gas which is a cleaner fuel ; solvent recovery plants have been
set up which has resulted in zero reduction of solvent disposal ;
Improved incinerating systems and reverse osmosis.

Sa fety a t its best

The company has made significant investments in the area of safety

over the past several years. Its steadfast commitment to safety is
reinforced by the fact that four of Asian Paints plants were conferred
with the 'Sword of Honour' by the British Safety Council for the second
time in quick succession. The British Safety Council is the world's
leading occupational health, safety and environmental organizations,
working closely with the world's leading companies in developing safe
systems for work. The "Sword of Honour", instituted by the BSC, is
recognized the world over as the pinnacle of achievement in safety
management systems.

CII na tional conser vation aw ar ds

Another recognition received in FY 2006 was the CII (Confederation of

Indian Industries) Award for National Energy Conservation received by
the Ankleshwar and Patancheru plants. The award function was held at
Vigyan Bhavan, New Delhi, where the Ankleshwar facility in the state
of Gujarat was honored with the second prize, while the Patancheru
plant in Andhra Pradesh received a certificate of merit. The awards
were presented by His Excellency, the President of India, and Dr. A P J
Abdul Kalam. The CII Award for National Energy Conservation is yet
another testimony of Asian Paints commitment towards the continual
improvement in our work process to help the environment through the
manufacturing excellence programme.

15. QUALITY POLICY

Asian Paints provides products and services that meet stated
standards on time, every time.

They accept Zero Defect as a quality absolute, and shall design and
operate their quality system accordingly.

Asian Paints organizes work practices to do a job right the first

time, every time.

They are committed to continuous improvement in quality in all

business processes and track such improvement through
measurable indicators.

16. AGE CARE

Age Care is another focus area of Asian Paints in its CSR activities.
The company had earlier conducted various health camps for the aged.
However, in India, the focus of such health camps has always been
around the plants where the employees reside. Taking this into
consideration, Asian Paints has started MMU (Mobile Medicare Unit) in
Kasna, Patancheru and Ahmedabad. MMU made it possible to reach the
doorsteps of the needy and provide treatment for various diseases like
hypertension, arthritis, diabetes etc. Also, the company had conducted
camps on eye care, dental care, blood checkup among others.

9. OTHETR
INITIATIVES
Impr oving infr as tr uctur e and heal thcar e at local
sc hool s

Besides water management and age care, the company also invests
time and energy in providing infrastructure support to primary schools.
In Ankleshwar - Gujarat, the company continues to support the "Shree
Gattu Vidyalaya" school which was established along with the
Ankleshwar Industrial Development Society in 1983. The school today
boasts of around 2,500 students in primary as well as secondary
sections and the plant has sustained its commitment of providing
infrastructure support to this school, be it through donations of
computers, tables and chairs, or through assistance in other
maintenance work for the school.

In addition, the Ankleshwar plant has also taken up the cause of

improving the health and hygiene situation of schools in nearby
villages. Understanding that prevention is better than cure, the plant
conducts Vaccination and Health camps. Not only students, but
teachers are also briefed on hygiene aspects in such camps.

In Sriperumbudur (South India) also, the plant is treading on similar

lines and has taken up the task of improving facilities in the
neighbourhood primary schools. It presented the Pondur primary
school with desks, tables, a PA system and even school bags for the
students.
Tsunam i reli ef: Hel ping co mmuni ty in need of
ti me

The massive disaster Tsunami hit the coastal areas of South India and
South East Asia on Dec 26, 2004 and left behind a trail of devastation.
As a socially responsible company, Asian Paints rose to the occasion
and decided to play its rightful role in extending support and relief to
the affected. All the employees contributed in cash and kind to the
best of their capacity. These contributions were supplemented with a
contribution from the company. A total amount of Rs. 4.7 million was
generated as relief aid and handed over to the Tsunami victims.
Besides India, all the units across the world also contributed to the
best of their capacities towards Tsunami relief.

4. PRODUCT RANGE
Asian Paints is continually innovating its product range to make your
world colourful and fun. And for the professionals, we deliver an
impressive range of products to match your specific requirements.

APE X UL TIM A:
Asian Paints is continually innovating its product range to make your
world colourful and fun. And for the professionals, we deliver an
impressive range of products to match your specific requirements.

APE X D UR ACAST :
Apex Duracast adds aesthetics and superior protection to new age
buildings. Setting higher standards in décor and performance, Apex
Duracast creates a permanent textured finish that is the best in its
category.
ROYALE PL AY:
Paint a dream. Have some fun. Let colours and textures mesmerize
your senses, soothe your soul. Jazz up your walls, accessorise.unbridle
your imagination. Play with Royale Play.

COL OU R PALETTE:
A rich range of shades to choose from to mirror the home décor as
you've imagined it.

SA MPLERS :
Asian Paints Samplers are 200 ml paint packs which can be used to
sample shades on the wall. These come in a range of shades that are
available through an Asian Paints Colour World outlet.

PROTE CTI VE CO ATIN GS:

Offers an extensive range of high performance, heavy-duty coatings for
protection of assets in aggressive industrial environments.

FL OO R C OATIN G:
Offers a wide range of coatings and floorings for concrete floors and
hygiene wall coatings.

ROAD MA RK IN GS :
The range includes hot melt thermoplastic road marking material, cold
applied retro-reflective and water / solvent based paint for marking
roads.

Asian Paints will introduce the Apcolite range of products which

is its premium quality range in international markets and the Decora
range which is its international brand for economy products. Under the
Apcolite & Decora brand many product segments will be covered in the
initial phase. Asian Paints will enter into segments like the interior wall
finishes, Exterior segment, Enamels and wood finish segment through
the mentioned brand names. The company will introduce immediately
the concept of multiple shade choice to the consumer in most of its
emulsion paints. The launch of multiple shades in its Apcolite range of
emulsions will provide consumer for the first time a wide choice of
colors that was not previously offered by paint companies.

5. PRODUCT PRICING
According to the management, Asian Paints’ volume growth during
Q4FY09 so far has been better than in the previous quarter (Q3FY09
volumes were flat). However, the company expects to post 8-10 %
volume growth in FY10E in decorative paints, based on historical
trends.

Though some of its markets such as Caribbean and Middle East could
have been impacted by recession, the company expects its
international business to grow in higher single digits in volume terms
owing to expansion in South Asia and the Egyptian market.
However, it expects industrial and automotive paints volumes to
remain under pressure on account of the economic slowdown and build
up of inventory in the automobile industry.
Since the automotive and industrial paint segments contribute less
than 10% to the consolidated top line, the impact of the same will be
limited. The government has recently affected a further cut in excise
duty from 10% to 8%; however, the company will take pricing action
based on volume demand and further softening of raw material prices.

Correction in input prices is likely to improve margins and could propel

the company to take price cuts to boost volumes and maintain its
market share. Asian Paints products command 5-8 % premium over
competitors. At current market price, Asian Paints trades at a P/E of
19.1x and 15.7x and EV/EBITDA of 12.0x and 9.8x on for FY09E and
FY10E, respectively. It is likely to remain under pressure in the short
term owing to slower volume growth, though downsides from current
levels look restricted.

17. BRAND
AMBASSADORS

The brand ambassador is not a new phenomenon for sure. Brands of

every category have used it in their quest for mind and market-space.
Brands have used the tool of the brand icon and brand ambassador in
their quest for success over the years.

Brand endorsement is a way to go! A way to get your brand noticed

amidst all the clutter that brands create in the marketplace. Amidst all
the noise and hype that brands indulge in so very freely. Brand
endorsement is possibly the best way to get the awareness rating of
your brand up there in the stratosphere of a clutter-free terrain,
otherwise unattainable with the me-too strategies of the marketer at
large.

The brand ambassador in many ways is meant to do different things for

brands at different times in their brand life cycles.

A Gattu for Asian Paints became as good a brand ambassador and an

icon as any person alive or dead!

Previously Asian paints were having KAREENA KAPOOR and KARAN

JOHAR as their brand ambassadors. But presently Asian paints have
roped in the brother-sister duo of SAIF ALI KHAN and SOHA ALI KHAN
as their brand ambassadors.

19. AWARDS AND

RECOGNITIONS

• 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 magazines 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.

18. COMPETITORS
As the households have started taking a keen interest in the interiors
and home décor, resulting in a drastic change in the scenario of the
entire paint industry. Thus Asian paints faces cut throat competition
against the following competitors:

BER GE R P AIN TS
GOO DL ASS

SH ALIMA R PAI NTS

JEN SO N NIC HOL SO

SN OWCEM INDIA

ICI I NDI A

KA NSAI NE ROLA C

DUL UX PAIN TS

CONTENT
S
1. INTRODUCTION
 2. COMPANY HISTORY
3. BOARD OF DIRECTORS
4. PRODUCT RANGE
5. PRODUCT PRICING
6. MANUFACTURING FACILITIES
7. SUPPLY CHAIN
8. RETAIL INITIATIVES
9. OTHER INITIATIVES
10.INTERNATIONAL OPERATIONS
11.INFORMATION TECHNOLOGY
12.RESEARCH AND DEVELOPMENT
13.ENVIRONMENT AND SAFETY
14.HUMAN RESOURCE
15.QUALITY POLICY
16.AGE CARE
17.BRAND AMBASSADORS
18.COMPETITORS
19.AWARDS AND RECOGNITIONS
20.REFERENCES
21.COMPANY ANALYSIS(BY- SUBHI SHARMA)
22.COMPANY ANALYSIS(BY- SAUMYA CHATURVEDI)

20. REFERENCES
WWW.WIKIPEDIA.COM

WWW.ASIANPAINTS.COM

WWW.GOOGLESEARCH.COM

http://www.icongrouponline.com/PR/Asian_Paints_(India)_Limited_
IN/PR.html
asianpaint s.com/applications/decorative.aspx

asianpaint s.com/pdf/press_releases/BIL_Dec02releaseforBSE.pd
f

www.microsoft.com/casestudies/ServeFileResource.aspx?23623

www.siliconindia.com/.../Asian _Paints _announces_growth_strat

egy-nid-17940.html

www.financialexpress.com/news/asian -paints .../135605/

www.moneycontrol.com/stocks/.../company_histor y

asianpaint s.com/corporate_information/company.aspx

www.business-standard.com

asianpaint s.com/applications/news_popup.aspx

marketingpractice.blogspot.com/.../asian -paints-every-color-tells-
story.html

www.scribd.com/doc/.../Market-Research-on-Paint-Industry

www.scribd.com/doc/2511399/SMBG

22. COMPANY
ANALYSIS
(BY-SAUMYA CHATURVEDI)
Asian paints was founded in 1942 as a small partnership firm and
now is India’s largest paint company. It ranks amongst the top 10
decorative coatings companies in the world today, with a
turnover of Rs. 25.6 billion. Asian paints operate in 22 countries
and have 28 paint manufacturing facilities in the world servicing
consumers in over 65 countries. Asian paints product range
includes Decorative Paints, Industrial Paints and Automotive
Paints.

The company has 5 manufacturing units which are located at

Mumbai, Ankleshwar, Patancheru, Kasna and Sriperambdur. Each
plant is headed by the factory manager. Bhandap plant is the
oldest plant with an installed capacity of 30,000 tonnes per
annum. All plants are also awarded with ISO 9000 and ISO 14000
certification.

Asian paints has won many awards , including rating under “200
best under a billion” by Forbes global in 2002, “best small
company in India” by Asia money in 2002,”Golden peacock”
national quality award by labour ministry,” Best supply chain”
award by i2 solutions, “Golden peacock environment
management award”, “ Five star rating” by British safety council
in 2003 and 2005.

A FEW KE Y POIN TS :

- The company enjoys enormous competitive advantage in its business.

It has a big mind share of the consumer, strong brands, great
distribution network and finally good management.

- The company has a high amount of locking at the dealer and painter
level. I have personally witnessed how this works. Once the company
achieves a high market share in a local market, it is difficult for any
other company to move into that market. In addition, the dealer
coloring machines add to this locking (once the dealer invests in the
coloring machine, he is unlikely to sell too much of competitor
products).

- The company management has always been rational, focused and

shareholder friendly. Their compensation structure is rational, there is
a low related party transaction and the management has made good
capital allocation decisions in the past (The ROE is now at 50%).

- The company has doubled the top line in the last 5 years and almost
tripled its net profits during the same period.

- The dividend levels have doubled in the last 5 years.

- The company continues to do well in the domestic market and

continues to have a leading position in the decorative paints segment
(which is almost 70% of the Indian paints market). 2008 has however
not been as good due to the slowdown in the economy and increase in
the RM prices.

- The international business had a turnaround in 2008 and has

continued to grow well in 2009. The profitability of the international
business has also improved substantially and was the reason why the
company was able to reduce the drop in net profits in the current year.

21. COMPANY
ANALYSIS
(BY- SUBHI SHARMA )
Asian Paints is India’s largest and Asia’s third largest paint company. It
is a vertically integrated paint company with in-house manufacturing
facility. It’s product portfolio includes wall paints, metal paints, wood
finishes, primers and others. The company’s market segments include
decorative and industrial coating segment. The industrial coating
segment consists of automotive coating, powder coating and
protective coating. Besides Asian Paints, the group operates around
the world through its subsidiaries Berger International, Apco Coatings,
and SCIB Chemicals.

One notable aspect that I personally like about Asian Paints is that, it
has been able to expand globally without taking on too much debt. It is
able to support its expansion plan from its internal sources.

Post acquisition of Scib Chemicals (for Rs245mn) and Berger

International (for Rs576mn), APIL has
emerged as a major decorative paint company in the world with 28
plants spread over 23 countries.
However no substantial gains could be expected from the international
operations in the medium term.
BI has an accumulated loss of US$24mn. Of the balance, most of the
international operations are
relatively small in size and in the growth phase.

Asian Paints domestic operations, particularly exterior paints, has

been driving volume growth. To cater to
rising volumes, Asian Paints is setting up a new 100,000 tpa plant at
Pondicherry. Investments in IT have led
to a substantial reduction in working capital cycles. Like it has done in
the past, we expect Asian Paints to
exceed industry growth rates.

QU ALI TATIV E A NALYSIS :

Over the years, Asian Paints has been a very stable and growing
corporation. It has kept growing along with the economy in both real
estate and industrial paints segment. It is also increasing its reach in
global markets.

It has had a very favorable dividend strategy in which it

consistently shared its profits with shareholders. The dividends have
doubled in last 5 years.

In addition, historically, it has been a very low debt company, with

most of the growth coming from organic sources. I like this aspect of
Asian Paints.

Along with slowdown in our countries and global economy, I expect

Asian Paints to shows reduced earnings. This is expected and extrinsic
factor which company does not have any control over. The most recent
analyst presentation shows that management acknowledges this
challenge and presents a realistic picture. It does not hype its
positioning and maintains a firm footing in realities.

I believe company is very well position to navigate this downturn

(brand value, distribution network, negligible debt, excellent
management, presence in different markets).

I like Asian Paints as a company, its brands, and

management’s dividend strategy. I like its market positioning and
ability to navigate the current downturn.