The four major paint manufacturers in India posted an 11.34 per cent growth in standalone net revenues in 2018-19 amid challenging market conditions. The industry remains optimistic of sustaining the double-digit growth level in the ongoing fiscal.

“The first half of 2018-19 was impacted by supply chain disturbances because of the cut in GST rates from 28 per cent to 18 per cent, leading to a bit of destocking in the distribution channel. There was significant raw material price inflation during the year with rising crude prices and a depreciating currency and this led to a few rounds of price hikes by the industry players to shore up margins,” said Asian Paints.

While decorative paints witnessed growth, industrial paints that constitute around 25 per cent of the Rs 50,000-crore industry was affected by the slowdown in the automobile segment.

Asian Paints further said demand for industrial coatings remained sluggish because of low manufacturing growth and a slowdown in the infrastructure and power segments.

Overhang of debt, rising policy uncertainties ahead of the general elections and lack of progress in unclogging the pipeline of stalled projects brought down the growth of the industry.

“Last year was tough but the industry still posted a double-digit growth. We expect growth in both value and volume this year. The growth of the paints industry is closely linked with that of the GDP. There is a stable government now at the Centre. If there is improvement of GDP, industry will also grow. There is relative stability on the raw material side with no major change in the last 3-4 months,” said Abhijit Roy, MD and CEO, Berger Paints.

“The government is expected to continue with its reforms agenda with policy decisions to come in sectors such as infrastructure and power. These reforms would provide great impetus to the economy as well as to the paints industry. Decorative paints segment is expected to continue the growth momentum. The fiscal incentives given by the government to the housing sector will aid the paints industry going forward,” said Kansai Nerolac.

The company estimates the industry to grow to Rs 70,000 crore by 2021-22.