Demand Analysis Demand Analysis of Asian Paints of Asian Paints

(Emulsion)(Emulsion)

Prepared By:Vikas GargManav NathDivya GargPrerna KaulGayatri MittalAnkur Kalra

Flow of the presentationFlow of the presentationObjective of the research IntroductionResearch MethodologyData Analysis and factsKey FindingsConclusionLimitations

OBJECTIVE OF THE STUDYOBJECTIVE OF THE STUDYTo analyse the demand of

EMULSIONS of Asian PaintsTo forecast the future demand of

Emulsions by taking in to consideration the potential Buyers of the product.

Introduction of Paint Industry Introduction of Paint Industry In IndiaIn IndiaOligopolistic Market

Indeterminate Demand Few Sellers Differentiated Product

The Indian paint industry is a $2 billion sector.

Grew at 9% rate in the last fiscalMarket Growth of about $200 - $400

million per year over next 5 yearsPer capita consumption of paint in

India is 800-900 grams compared to 15-25 kg in the developed countries

Contd…..Contd…..

Leaders in the IndustryLeaders in the IndustryAsian Paints (India) Ltd. (APIL)Kansai Nerolac Paints Ltd. (KNPL)Berger PaintsJenson & Nicholson Ltd (J&N)ICI (India) Ltd.

ASIAN PAINTSASIAN PAINTSMarket Leader with 33% share in

the organised paint marketLargest distribution networkLargest Brand EquityBerger Group and ICI are nearest

competitors with 17% market share each

Dominates the decorative segment with 38% market share

More than 15000 retail outlets

Financial Picture of Asian Paints

Year Sales

(In crores)

Operat-ing Profit (Lakhs)

Interest

Net Profits

Loans

2008 3416.16

3595.53

8.27 377.89 1005.90

2007 2821.29

2953.38

6.87 269.93 851.68

2006 2319.16

2447.78

3.83 187.81 694.86

2005 1941.52

2052.28

2.75 173.82 637.27

2004 1742.46

1800.63

5.27 147.58 583

Research MethodologyResearch MethodologyPrimary Research (Questionnaire)Sample surveySample Size:

◦Dealers Asian Paints Dealers Other Brands Dealers

◦Customers: Existing Asian Paints Users Prospective Users

Data Analysis and FactsData Analysis and Facts3 types of consumers existing in

the market divided on basis of income groups◦Premium (Prefer Emulsion)◦Average (Emulsion + Distemper)◦Poor (Prefer Distemper)

Data Analysis and Facts Data Analysis and Facts (Contd..)(Contd..)

Data Analysis and Facts Data Analysis and Facts (Contd..)(Contd..)Consumers rely more on Dealers

& Contractors other than ad’s◦Reasons being

Info about Quality Durability Price Long Lastingness

Price sensitivity FactorsPrice sensitivity FactorsRaw material Intensive IndustryNear half of them imported

petroleum productsMajor Raw Materials:

◦Titanium Dioxide◦Phthalic anhydride ◦Peutarithrithol

Price sensitivity Factors Price sensitivity Factors (Cotd….)(Cotd….)Factors which influence price of

paint◦Prices of the raw materials◦Import Policies◦Global Crude oil Prices◦Govt. Policies◦Packaging Costs

Elasticity of Demand of Elasticity of Demand of PaintPaintDemand for Decorative Paints is

relatively Elastic in short termIn Long term it depends on the

overall economic growthIncome of people also plays an

important rolePremium customers are more

Quality conscious than price sensitive.

Average customers are more price sensitive

Data Analysis and FactsData Analysis and Facts

Data Analysis and FactsData Analysis and Facts

RANK BRAND

1 Asian Paints

2 Dulux

3 Berger

4 Nerolac

5 Shalimar

6 Nitco

Sales Information of different brands as projected by the dealers

Data Analysis and FactsData Analysis and FactsVariation in Sales in different

QuartersComments by the dealers:

◦Sales in the third quarter is equivalent to the rest of the year

◦But, now growth in the third quarter is reduced by 10% compared with the same quarter of last year.

Feedbacks from DealersFeedbacks from DealersNot satisfied with policies of Asian

PaintsNegative Comments about the dealing

of the companyMain reason being the low profit

margin compared to the other companies

No Extra Rewards for the large dealersDemand more profit margin and extra

incentives for better sales performance

Key FindingsKey FindingsAsian paint emulsion used for

interior decoration by the premium segment of customers.

Dealers and Contractors : Tools for APIL to create a slot in the customer’s mind.

Problems with the other brands give APIL the lead in the market.

Key Findings contd…Key Findings contd…Low profit margin a great

concernSales rises in the third quarter.Little shift in the income of the

average class makes them shift to the emulsion category.

Bad credit terms.

Suggestions for still better Suggestions for still better Demand!Demand!Dealers should get price

relaxation.

Limitations !Limitations !Sample space limited to :100 customers 30 dealers.Time constraintDealers not co-operativeSo were some of the customers.

THANK THANK YOU !! YOU !!