Work on the Sandila factory near Lucknow is in progress and the company is investing around `800 crore to set up the plant, which will manufacture its entire range of decorative paints.
Berger Paints, the country’s second largest paint company, is looking to operationalise its fully-automated manufacturing plant near Lucknow by January next year to gain a higher market share in Uttar Pradesh, Bihar and Madhya Pradesh.
Work on the Sandila factory near Lucknow is in progress and the company is investing around Rs 800 crore to set up the plant, which will manufacture its entire range of decorative paints.
“The Sandila factory is expected to commence operation by January-end. Its production capacity will be 15,000 metric tonne per month. This plant will help us gain market share in Uttar Pradesh, Bihar and Madhya Pradesh. We will also make efforts to strengthen our distribution network in these markets,” Berger Paints MD and CEO Abhijit Roy said.
The company’s production capacity in the decorative paints segment currently stands at 65,000 metric tonne per month. Apart from automotive paints and industrial paints, Berger also produces construction chemicals, and water proofing and protective coatings.
In Uttar Pradesh, Asian paints and Berger Paints are very close in terms of market share. On a pan-India basis, Berger holds around 19% of the overall market share in terms of value among listed paints companies. Berger is trying to improve its distribution network to close the gap with market leader Asian Paints, Roy has said during the company’s 96th AGM in September last year.
The Kolkata-based company has also acquired land at Panagarh in West Bengal to set up a new plant to produce construction chemicals and water proofing products. “Work to set up the plant is expected to start after the monsoon,” Roy said.
He said that in June, the company has witnessed demand growth in upcountry and rural areas. Demand is also visible in cities. “In April we saw good demand, but in May it reduced because of localised lockdowns,” Roy said.
In the current financial year, the company is looking at double-digit sales growth in terms of volume and value. Last fiscal, it had clocked 7.1% sales growth in terms of value and 13% in terms of volume.