India's Grasim launches paints business, targets 100 bln rupees in gross revenue in 3 yrs

JSW Dulux

22/02/2024 09:48

BENGALURU, Feb 22 (Reuters) - Grasim Industries
 GRAS.NS  launched its paints business under the 'Birla Opus'
brand on Thursday, and said it expects the unit to generate 100
billion rupees ($1.21 billion) in gross revenue in three years.
    The Aditya Birla Group company had raised money twice in
calendar 2023 to fund the paints venture. The forecast implies
it expects to recoup its investment in the form of revenue by
2027.
    The paints business, which adds to Grasim's flagship
businesses of textiles and chemicals, could make the company the
second-largest Indian paintmaker by capacity behind market
leader Asian Paints  ASPN.NS , according to analysts.
    Asian Paints currently controls nearly half of India's
paints market. It recorded a revenue of 90.75 billion rupees in
the quarter ended Dec. 31.
    Kansai Nerolac  KANE.NS , Berger Paints  BRGR.NS , Indigo
Paints  INDG.NS  and Dulux paint-maker Akzo Nobel India
 AKZO.NS  are the other major players.
    Antu Thomas, research analyst at Geojit Financial Services,
said Birla Opus could take as much as 1%-2% in market share from
Asian Paints.
    Jefferies added that the business would account for nearly
half of the 25% capacity addition expected in the industry over
fiscal 2024-2027.
    "The paint sector has never seen such massive capacity
build-out in such a short span even from incumbents," Jefferies
analysts said in a note.
    Products and services from the business, announced three
years ago, will be available in three Indian states from
mid-March, Grasim said.

($1 = 82.8670 Indian rupees)

 (Reporting by Varun Vyas in Bengaluru; Editing by Janane
Venkatraman
)
 ((varunvyas.hebbalalu@thomsonreuters.com;))