The size of the Indian paints & coatings industry is estimated to grow to Rs 1 lakh crore in the next five years from the present Rs 62,000 crore, said Akzo Nobel India.

Besides, the margin for the paints & coatings industry will improve as in FY23, it witnessed softening of raw material prices from their previous highs, said the latest annual report of Akzo Nobel India, a leading player in the segment.

“As raw materials account for approximately 55-60 per cent of the input costs, price corrections in crude oil and other essential components resulted in improved margins for the industry,” it said.

The industry has emerged as an attractive sector, by the entry of several new players in recent times, which are actively investing in infrastructure, technology, and marketing to establish their presence and capture a share of the market, it said.

“This heightened competition has prompted existing players to further bolster their capabilities and differentiate themselves in order to maintain their market position, leading to a surge in investment activity within the industry,” it added.

In the last few years, several companies such as Grasim Industries, Pidilite, and JSW have entered into the segment and are competing with established makers such as Asian Paints, Berger Paints, Kansai Nerolac and Akzo Nobel India, which collectively control nearly 3/4th of the market.

“The size of the industry is estimated to grow from Rs 62,000 crores to Rs 1 lakh crore in the next five years,” it said.

The industry is divided into two categories - architectural segment and industrial segment.

The architectural segment dominates the industry as its accounts for around 69 per cent of the paint consumption on a volume basis. This segment primarily caters to residential, commercial, and institutional constructions, as well as repainting and renovation projects.