Open to acquisitions if they make economic sense

Written by Lalitha Srinivasan | Updated: May 24 2014, 10:32am hrs
Asian Paints, which has a 55% share in the domestic market, has been focusing on organic as well as inorganic growth to maintain its leadership. After acquiring 51% in Sleek International (kitchen solutions provider) in August 2013, it recently announced the acquisition of Ess Ess Bathroom Products for an undisclosed sum. CMD KBS Anand shared

the company's strategic plans in an interview with Lalitha Srinivasan. Excerpts

You posted a 15% increase in profit in Q4FY14. What were the major drivers

The main reasons were strong volumes growth, a revision in interest rates for gratuity investments, resulting in reversal of expenses, and a stronger rupee, leading to a forex gain.

What is the rationale behind acquiring Ess Ess Bathroom Products

This is part of our strategy to enter the home improvement sector in India in this case, the bath and wash segment. We feel this sector has considerable synergy with our retail paint business we address the same consumers and distribute our products through the same channels (our retailers).

Are you scouting for more acquisitions

We have just entered the home improvement space, and are open to acquisitions in other areas as long as they make economic sense and fit our requirements. To expand our international presence, we recently entered into an agreement with Kadisco Chemical Industry of Ethiopia, where we are acquiri ng 51% stake.

Why did you close your

oldest plant at Bhandup

It was an old and sub-scale small plant, set up in 1956. It was not economical to operate vis-a-vis our bigger, newer plants. Also, there wasnt enough space to make it operationally safe, just as our other plants. That was a reason of worry considering the large residential and commercial sites in the vicinity.

Are you raising prices to offset rising input costs

We have implemented a 1% price increase effective May 1 and announced a second increase of 1.2% starting June.