List Of Best Paint Stocks in India 2024

With a booming construction sector and a growing preference for customized home decor and contemporary interiors, the demand for paints is rising. The paint industry in India carries the potential to offer a good investment opportunity to the people. Investors looking forward to diversifying their portfolios or capitalizing on the growth of this sector may find paint stocks a lucrative option.

Today’s blog explores the best paint stocks in India that an investor can watch out for, their recent returns, and how the paint industry is poised for growth in the future.

Overview of the Paint Industry in India

The estimated value of India’s paint and coatings market is around $9.56 billion and is expected to reach a valuation of $15 billion by 2029 at a CAGR of 9.38%. Decorative paints account for approximately 69% of the market share, while industrial paints contribute 31%.

Many infrastructure projects were delayed due to COVID-19, which also had a negative impact on the paint industry. Their revenues decreased, and paint stocks struggled to deliver returns during the lockdown phase. However, due to widespread vaccination campaigns, the economy recovered, and the demand for paints increased, which makes this an exciting sector to look out for in the future.

Top Paint Stocks Based on Market Capitalisation

List of Top Paint stocks based on the Market Capitalisation:

The paint stocks have been listed in descending order based on their market capitalization in the table below:

Best Paint Stocks in India Based on Market Capitalization – An Overview

The best paint stocks in India are given below, along with a brief overview:

1. Asian Paints Ltd.

In 1992, four friends named Champaklal Choksey, Chimanlal Choksi, Suryakant Dani, and Arvind Vakil started Asian Paints in a garage in Mumbai. During World War 2, paint imports were limited, and they recognized the chance to meet the increasing demand for paint in India. By 1967, Asian Paints had already positioned itself as the undisputed leader in the paint manufacturing industry in India. Currently, the company operates in more than 60 countries, with manufacturing sites in 15 countries.

The company’s core business activities include producing a diverse range of paints, coatings, and allied products. A large distribution network makes sure that products are available in many places, such as stores, wholesalers, and directly to consumers. The main revenue is from selling decorative and industrial paints. Additional revenue of the company comes from selling home décor items, bath fittings, and other related products. The company also offers color consultation services and painting solutions.

2. Berger Paints India Ltd.

Berger Paints had its origins in 1760 when Louis Berger, a chemist from Germany, established a business in England that produced dyes and pigments. The company started operations in India in 1923 with a small paint business in Kolkata. Today, Berger Paints holds a strong presence in India and has manufacturing units in Nepal, Bangladesh, Poland, and Russia. The company has many manufacturing facilities in India that produce a variety of paints, coatings, and related products. It also invests in research and development to create new products, enhance current formulas, and meet changing customer needs. The primary revenue comes from the sale of decorative and industrial paints.

3. Kansai Nerolac Paints Ltd.

The company was originally called Goodlass Nerolac Paints and was established in 1920. In 1976, it became a part of the Tata Forbes Group. A major event occurred in 1983 when a top Japanese paint company, Kansai Paint, partnered with Goodlass Nerolac. In 1999, the entire stake of Tata Forbes Group was bought by Kansai Paint Co. Ltd., and then after a few years, the company was rebranded as Kansai Nerolac Paints.

The company produces a diverse range of paints and coatings for both industrial and decorative segments, making them a popular choice for residential and commercial projects.

4. Akzo Nobel Ltd.

Akzo Nobel is a well-known Dutch company that specializes in paints and coatings. With its extensive global presence, the company serves the needs of both industrial and commercial markets. Akzo Nobel was founded in 1994 when Akzo acquired Nobel Industries. It currently operates in 150 countries and owns several popular paint brands like Dulux, Sikkens, etc.

The company manufactures and sells paint and coatings for industrial and consumer markets worldwide. The main source of revenue is from selling decorative and industrial paints, along with performance coatings.

5. Indigo Paints Ltd.

Indigo Paints has swiftly emerged as a key player in India’s paint industry, propelled by its dynamic growth strategy and commitment to customer satisfaction. The company was founded in 2000 by Hemant Jalan as a cement paint manufacturer. Despite facing numerous challenges, Indigo Paints demonstrated continuous determination and expanded its product range. It now offers an impressive array of decorative paints, enamels, wood, coatings, primers, distempers, putties, and waterproofing solutions. The company is mainly focused on developing a strong distribution network, especially in Tier 2 and Tier 3 cities. The primary revenue comes from the sale of decorative paints and other allied products.

Top Paint Stocks Based on 1-year Return

The Top Paint Stocks in 2024 are:

The paint stocks have been listed in descending order based on their 1-year return in the table below:

Best Paint Stocks Based on 1-year Return – An Overview

The best paint stocks in India are given below based on the 1-year return, along with a brief overview:

Retina Paints Ltd.

Retina Paints was founded in 2010 as a private limited company and is a relatively new entrant in the paint sector. It was converted to a public limited company in 2023 and was listed on the BSE SME platform. The company offers a diverse range of products, such as emulsions, distempers, primers, spray plasters etc. The company has been steadily growing its market presence through product quality and durability.

Retina Paints operates on a B2B business model and sells its products to dealers and distributors.

MCON Rasayan India Ltd.

MCON Rasayan was founded in 2016 and has become a popular manufacturer and supplier of construction chemicals and building finishing products. The company caters to both domestic and international markets. Its product portfolio comprises over 80 items including:

• Powder products: Ready mix plaster, tile adhesives, block adhesives, wall putty, micro concrete, floor hardeners, etc.
• Liquid Products: Polyurethane (PU) based liquid membrane, bonding agents, paints, anti-corrosive coatings etc.

The company is committed to maintaining the highest quality standards and has established itself as a reliable player in the construction chemicals industry. The primary revenue of MCON Rasayan comes from the sale of construction chemicals to distributors, builders, contractors, and other end users.

An overview of Akzo Nobel India Ltd. is mentioned above.

Key Performance Indicators (KPIs)

Benefits of Investing in Paint Stocks

The benefits of investing in paint stocks are:

• Urbanization – Urbanization in India and other developing countries leads to higher demand for paints in construction and renovation projects.
• Infrastructure Development – Government initiatives to build infrastructure increase the demand for paints.

Factors to consider before investing in Paint Stocks

An investor must consider the following factors before investing in paint stocks:

• Raw Material Costs – The profitability of a paint company can be affected by fluctuations in the prices of essential raw materials such as crude oil, titanium dioxide, and resins.
• Competitive Landscape – The paint industry is dominated by a few big companies. It is important to understand which companies are market leaders and their market share.
• Analysis of the Related Sector – Real estate and construction companies directly impact the demand for paint.
• Interest Rates – Interest rates affect the housing market, which can affect the demand for paint.

Future Outlook of the Paint Industry

The ongoing urbanization trend is a major catalyst for the paint industry due to new residential and commercial constructions. Also, as existing properties age, the need for renovation and repainting the structure will increase. Government policies supporting affordable and convenient housing and infrastructure development will positively affect the industry. Tapping into the rural markets with suitable products can also help open new avenues. Overall, the industry is expected to witness growth in the coming years.

Conclusion

To summarize, the Indian paint industry is a strong and promising sector with good growth opportunities. Companies like Asian Paints and Berger Paints are leading the way through consistent performance and strategic expansion. Before investing, it is important to research market trends, financial performance, and industry dynamics and consult a financial advisor.

Frequently Asked Questions (FAQs)