Building on the ancillaries business
Nov 29, 2013
Source : The Hindu


MUMBAI: The rapid growth in the housing sector over the past two decades has catalysed the growth of allied segments such as paints, ceramics, electricals and sanitary fittings. They are expected to continue with their momentum in the years to come.

The increasing per capita income levels across the country and growing aspiration and desire among people to remodel and embellish their homes units have been driving the demand in all these categories.

The higher spending power among masses, resulting from the sustained GDP growth witnessed over the last decade and changing lifestyles have seen consumers shift to the branded products in segments such as electricals and tiles.

Paints industry

Apart from real estate, the infrastructure sector is also contributing to the growth of the paints industry. The total paints market in India was pegged at Rs 26,040 crore in 2011-12. A study by the Indian Paints Association and AC Neilsen has projected the paints market in the country to touch Rs 49,545 crore by 2016-17. The per capita consumption is pegged at 2.57 kg.

The decorative paints category accounts for around 70 per cent of the total value while the industrial paints accounts for the rest.

In terms of volume, the overall paint market is pegged at 3.11 million tonnes. Apart from real estate, the growth in automotive sector is also contributing to the growth of the paints segments.

To cater to the rising demand, the paints industry has been expanding production capacity, besides widening the distribution network and educating consumers on the uses of paint.

Ceramic tiles

In case of the ceramics tiles industry, the growth comes from increasing style consciousness and aesthetic sense among consumers.

However, like in the paints segment, the per capita consumption in ceramic tiles is also lower in India at 0.50 sq m in comparison to over 2 sq m in China, Brazil and Malaysia, thereby holding tremendous growth potential.

According to the Indian Council of Ceramic Tiles and Sanitaryware, the tile industry has been growing at 15 per cent per annum.

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