Berger Paints India Ltd has initiated moves to re-focus on its business in Russia and Poland. The company’s Chairman, Kuldip Singh Dhingra, told Business Line on Thursday that the former MD and now Additional Director, Subir Bose, would be in charge of the Russian and Polish businesses. A strategic growth plan has been draw up for both countries.
“He would take charge from September 15,” the Chairman said. The Russian business, with a manufacturing unit in Krasnodar in the south western part of the country, is under Berger India’s subsidiary, Berger Paints Overseas Ltd.
Bolix SA, which also has manufacturing unit, is the corporate entity of Berger India in Poland.
Subir Bose would also be responsible for the long-term strategy and implementation of the plan for Berger India in certain parts of Europe and Central Asia both in paints and external insulation finishing system.
Bolix SA recently floated a subsidiary — Bolix Ukaraine Ltd Liability — to get a foothold in Central Asia.
Long-term strategies
Berger has taken several long-term strategies to shore up the nascent operations in Russia, including export of different categories of paints from India and the re-structuring of sales network.
The Chairman said Bolix would also join in. “We have around 12 acres. Setting up a manufacturing unit of Bolix external insulation products is a possibility. Bolix would also have to take care of human resource development issues in establishing and running such a unit in Russia,” Kulip Singh Dinghra said.
At present, the operation size of the paints unit in Russia is small. It reported a cash loss of Rs 1.2 core in the last financial year. “The new strategies will be geared to yield positive operational and financial results. We would also draw an investment plan for the Russian business,” the Berger India Chairman added.
Even though Bolix increased market share and grew sales by 18 per cent, margins came under pressure because of steep increases in raw material prices and adverse foreign exchange fluctuations on imported raw material prices, resulting in a loss of Rs 1.4 crore.