According to officials in the company, it has decided to either acquire a manufacturing unit for the purpose or set up one. Shalimar, which started operations in 1902, is the oldest paint company in the country.
Referring to the companys plan, managing director SL Agarwal said, This will help us establish our reach across the country.
Shalimar has factories in Howrah (West Bengal), Sikandrabad (Western UP) and Nasik (Maharashtra).
The proposed unit in the south will have both water-based and solvent-based paints. In the next 24 months we will have a production unit in south India. We will select the facility and the place depending on the tax incentives and other facilities to be provided by the state government besides commercial considerations like the cost of acquisition, said AK Mukherjee, the chief of operations in the eastern region.
The company, which has between 5-7% market share in the decorative and industrial paints segments, has recently become a debt-free company. We have posted a net profit of Rs 2 crore and a revenue of Rs 175 crore on an annualised basis. Our profit is low as we have paid back all our debts, said Mr Mukherjee. He said that the companys investment in the new plant will be through internal accruals. We are now a profitable company. We have not yet decided how much we will spend, we will invest what is needed to set up a plant to meet our objectives. The company expects 25% growth in revenue for the year 2004-05. The growth will result from the companys plan to increase its production capacity from 39,000 kilolitres to 49,000 KL, according to Mr SL Agarwal.
Mr Mukherjee and Mr Agrawal were here to inaugurate the four-colour space tinting system at the centres owned by the company dealers. Shalimar is also planning to launch high-performance coating for a specific industry segment.
Mr Agrawal refused to provide any details on this. We are working on this and we will soon enter into a technology tie-up with a foreign company to produce speciality paint.