In its 100th year, Berger Paints India is sprucing up its canvas to meet ambitious new growth targets. Next-gen is taking charge, a brand new corporate office in the shape of a cylindrical paint can promises to shake up Kolkata’s skyline and aggressive investments to ramp up production capacity are being made.
On August 13, as part of a strategic succession planning exercise, next generation of the promoter family Rishma Kaur and Kanwardip Singh Dhingra, took over as the Chairperson and Vice Chairman of the country’s second largest paint maker, after siblings Kuldip Singh Dhingra and Gurbachan Singh Dhingra stepped down.
Painting the future
Kuldip and Gurbachan had acquired the storied company that had started in Kolkata in 1923 as Hadfield’s and seen many ownership changes passing from British to the Indian hands. They bought it from beleaguered liquor baron Vijay Mallya in 1991. The two brothers, now Chairman Emeritus and Vice Chairman Emeritus, are continuing on the board as non-executive directors to guide their children on strategic thinking and overall understanding of the business.
“The new generation will carry the mantle forward from the promoter side. And also within our company we are preparing the next generation of leaders,” Berger Paints India Managing Director and CEO Abhijit Roy told businessline.
The Kolkata-based company is the fourth largest paint maker in Asia. Its consolidated revenue crossed ₹11,000 crore last fiscal with around 20 per cent market share in India’s fiercely competitive paint industry, belived to be in the region of ₹60,000 crore.
On August 12, speaking at the company’s 100th Annual General Meeting as the Chairman for the last time, Kuldip Singh Dhingra said, “As we enter the next 100, we believe it will be as vibrant and illustrious as the last. We envision continuing our leadership in India’s paint sector driven by innovation, trust and excellence.”
Berger began its operations a century ago with a single manufacturing unit in West Bengal’s Howrah district. Today, it has 29 manufacturing units and a presence across Russia, the UK, France, Ukraine, Poland and Nepal.
It took the company almost 100 years to touch the ₹10,000 crore revenue mark, but the management is confident that the next ₹10,000 crore will come in the next six years.
“We crossed the ₹10,000 crore mark in FY23, and in FY24 we ended up with ₹11,200 crore of consolidated sales. We have an ambitious growth plan and a lot of expansions are likely to happen. The next ₹10,000 crore is going to happen by FY29,” Roy asserts.
Currently, around 80 per cent of the company revenue comes from decorative paints.
The paints major has set in motion plan to not only expand production capacity but also ramp up its distribution network. It is pumping in ₹2,000 crore in two green field projects, one in West Bengal and other in Odisha, to expand its overall production capacity by around 25-30 per cent.
The current production capacity stands at around 1 lakh metric tonnes per month. The greenfield project at West Bengal’s Panagarh is expected to be commissioned by end-2025, while the integrated manufacturing unit in Odisha is likely to go on stream in mid-2027.
To close the large gap between it and market leader Asian Pains, Berger is working hard to strengthen its distribution networks across the country. Asian Paints currently enjoys over 50 per cent market share.
“There are still a large number of areas where we don’t have adequate distribution at present. We are working on them actively,” Roy said, adding the company is looking to increase its market share to around 23 per cent in the next six years.
Crowded gallery
However, competition is intensifying in the paints sector with players like Aditya Birla Group entering the segment with new products and services, under its new decorative paints brand, “Birla Opus”. The group has an ambitious target of ₹10,000 crore gross revenue within three years of full-scale operations.
Commenting on it, the Berger MD said, “We will be around ₹10,000 crore in the decorative segment at the end of this fiscal itself. So, we are very confident that our growth path will continue. We take them (competition) very seriously. We will ensure that our trajectory is not impacted so much.”
In a recent report on the country’s paints industry, domestic brokerage firm Nuvama Institutional Equities noted: “Consumer response to new paints companies has been weak so far — not surprising given its very high entry barriers. Despite new players’ significant resources, we do not expect them to disrupt the market — as confirmed by confidence shown by all legacy players: Asian Paints, Berger, Indigo, Kansai Paints and Akzo.”
As it is moving into its quirky looking office in New Town from the old Park Street building where it has been for the last 50 years, Berger is meeting the future head on with new brushstrokes.