Godlass Nerolac Paints, India’s second largest paints company, is keen on overseas acquisition, particularly the South East Asian region.
MUMBAI: Godlass Nerolac Paints, India’s second largest paints company, is keen on overseas acquisition, particularly the South East Asian region.
“We are open to acquisition if we find a right company. However, we haven’t zeroed on any so far,” said Ashok Saini, vice-president - special projects, on Tuesday. Saini said, in the domestic market, there were not too many potential buyout candidates.
The company would be utilising its reserves and internal accruals to fund acquisitions.
In October, the company had acquired a 55% stake in a Malaysian decorative paints company Sime Coatings Sdn Bhd for about Rs 30 crore.
The balance was held by the $1.8-billion Japan’s Kansai Paint Co, which also holds 65% stake in Goolass Nerolac. As per the agreement, for an acquisition in the decorative paints segment, Goolass Nerolac would hold a majority stake, and in industrial paints segment, Kansai would be the majority partner.
The organised paints industry in India is about Rs 5,700 crore, of which decorative paints is Rs 4,350 crore and the rest is industrial.
Goolass Nerolac is keen to grow its decorative paints segment, where it holds a 14% market share, trailing behind Asian Paints’ 35% plus share. Nerolac, however, dominates the industrial paints segment with a 65% market share.
Goolass Nerolac, in association with Disney Consumer Products, on Tuesday announced the launch of its new range of decorative paints. Goolass Nerolac would pay an undisclosed royalty to the entertainment giant for the use of its popular characters like Mickey Mouse.
“We are initially rolling out the product in 8 cities and our target audience is urban Indian families with kids under the age of 10 years. There are 1,30,000 such households,” said Anuj Jain, vice president - sales and marketing. According to the company, the cost of doing up a single wall with Disney characters works out to around Rs 2,500.
Goolass Nerolac is aiming different retail formats to market its goods. It has booked space in an upcoming home decor mall in Pune.
“The shopping habits of Indians are changing. Although it is still not fashionable to go to the paints shop and select your shade, we understand that with the number of malls coming up, experiential, or touch-and-feel type shopping would go up. We do not want to miss that,” said a company official on the logic behind booking space in the home decor mall. In its rural initiative, it has already tied up with ITC Ltd to market paints through the latter’s rural malls.
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