Painting An Introduction
The earliest use of paint can still be seen today in caves of prehistoric men. These crude paints, created some 30,000 years ago by cavemen, were used to document various aspects of life such as hunting. Back then, the colours were limited to black, red and yellow, together with intermediate tints. In the period 3000BC to 600 BC, the Egyptians expanded the colour range with their chemical processing techniques. Some of the pigments they created include green, black and white. Lake pigments, an important paint group even today, were also first developed by the Egyptians. In Asia, Japan was using a totally different sort of coating for its protective value. Lacquer, a clear coating that brings a sheen of sturdy protection to surfaces, was used as early as the Stone Age in Japan. From about 4,000 years ago, lacquer was already used widely for tableware, utensils, weapons and various accessories. Paint, in particular its protective function, was given a big boost during the Industrial Revolution as demand was then high for anti-corrosive coatings that could delay or prevent rust and corrosion in metals. Lead- and zinc-based paints were developed to fulfil these needs. Many other types of paints and coatings were also created to respond to the growing needs of paint to protect and preserve. By mid 1800s, the Western world's paint industry was growing healthily as an increasing number of paint manufacturing companies were founded.
The World War did much to accelerate the development of paint. For example, large quantities of nitrocellulose - a chemical used prior to this in paints - were used for explosives during the war. With the end of the war, this excess nitrocellulose was put to good use as automotive coatings.
The paint industry today is a multi-million dollar industry. Beyond attractive colours, the industry now covers a large number of disciplines including polymer chemistry, rheology and pigment technology. Much investment has been channeled into dedicated research to develop paints and coats that not only look good, but also offer increasingly improved functionalities such as anti-corrosion and heat-resistant properties.
Present day research is focused on developing products that preserve the ecological balance and protect life. The challenge today is to create eco-friendly products such as water-borne coatings and lead-free paints, amongst other products.
Pakistan Paint industry overview
The paint industry in Pakistan operates both in organized as well as unorganized sectors. There are around 22 paint producing units in the organized sector. In the organized sector there are two multinational companies also present. The data regarding number of units and production of unorganized sector is not available; therefore it is difficult to determine the total production and number of units of paint industry. According to an estimate, over 350 units producing paints and varnished are operating in the unorganized sector. Many of them are not covered under the excise net in the someway as the organized and therefore, are in a better position to compete in local market. According to Federal Bureau Statistics, during 2001-2002 around 17,000,000 liters of paint was produced from 87 units. Pakistan Paint Manufacturers Association (PPMA) represents the organized units in paint industry. The paint industry uses about 300 different types of raw material for producing various kinds of paints. About 15 percent raw materials of the industry are petroleum-based. In 1971, between 80 to 90 percent requirement of raw material were met through imports, which currently have been reduced to about 40 % percent due to increased production of indigenous raw materials. The major raw materials produced locally include Mineral, Turpentine, Resins, Vegetable Resins and Gums, whereas raw material such as Pigments, Zinc Oxide, Titanium oxide and Lithopone are imported. Paint is categorized in two broad classes namely water based pain and solvent based paint. The industries produce a wide range of finish and intermediate products which pigments, distempers, plastic emulsion, enamel, undercoat, primers, rubber paint, aircraft paint, marine paint, anticorrosive paint, anti fouling paint, etc. BMA Capital forecast the future of Paint industry in their annual report they suggest that “Paints is another segment which can be adversely impacted by economic slowdown as growth contracts in the construction and auto industries. The company however, stands to benefit from new parent Akzo Nobel whose expertise lies in decorative paints and will allow it to expand its portfolio. ICI plans to export paints to Iran and Afghanistan as well which will help them to sustain profitable in current turmoil. The joint ventures and calibrations with international players are strengthening the industry and providing more varieties of paints to the customers. Last year, the Asian Paints made an indirect entry into Pakistan, through a technical consultancy tie-up between Berger International Singapore – a company it acquired in 2002--and Berger Paints Pakistan. This tie-up will allow Berger Paints Pakistan to access product technologies and products from the Asian Paints group.
Here are some statistics about paint industry;
PAINT MARKET STRUCTURE
The earliest use of paint can still be seen today in caves of prehistoric men. These crude paints, created some 30,000 years ago by cavemen, were used to document various aspects of life such as hunting. Back then, the colours were limited to black, red and yellow, together with intermediate tints. In the period 3000BC to 600 BC, the Egyptians expanded the colour range with their chemical processing techniques. Some of the pigments they created include green, black and white. Lake pigments, an important paint group even today, were also first developed by the Egyptians. In Asia, Japan was using a totally different sort of coating for its protective value. Lacquer, a clear coating that brings a sheen of sturdy protection to surfaces, was used as early as the Stone Age in Japan. From about 4,000 years ago, lacquer was already used widely for tableware, utensils, weapons and various accessories. Paint, in particular its protective function, was given a big boost during the Industrial Revolution as demand was then high for anti-corrosive coatings that could delay or prevent rust and corrosion in metals. Lead- and zinc-based paints were developed to fulfil these needs. Many other types of paints and coatings were also created to respond to the growing needs of paint to protect and preserve. By mid 1800s, the Western world's paint industry was growing healthily as an increasing number of paint manufacturing companies were founded.
The World War did much to accelerate the development of paint. For example, large quantities of nitrocellulose - a chemical used prior to this in paints - were used for explosives during the war. With the end of the war, this excess nitrocellulose was put to good use as automotive coatings.
The paint industry today is a multi-million dollar industry. Beyond attractive colours, the industry now covers a large number of disciplines including polymer chemistry, rheology and pigment technology. Much investment has been channeled into dedicated research to develop paints and coats that not only look good, but also offer increasingly improved functionalities such as anti-corrosion and heat-resistant properties.
Present day research is focused on developing products that preserve the ecological balance and protect life. The challenge today is to create eco-friendly products such as water-borne coatings and lead-free paints, amongst other products.
Pakistan Paint industry overview
The paint industry in Pakistan operates both in organized as well as unorganized sectors. There are around 22 paint producing units in the organized sector. In the organized sector there are two multinational companies also present. The data regarding number of units and production of unorganized sector is not available; therefore it is difficult to determine the total production and number of units of paint industry. According to an estimate, over 350 units producing paints and varnished are operating in the unorganized sector. Many of them are not covered under the excise net in the someway as the organized and therefore, are in a better position to compete in local market. According to Federal Bureau Statistics, during 2001-2002 around 17,000,000 liters of paint was produced from 87 units. Pakistan Paint Manufacturers Association (PPMA) represents the organized units in paint industry. The paint industry uses about 300 different types of raw material for producing various kinds of paints. About 15 percent raw materials of the industry are petroleum-based. In 1971, between 80 to 90 percent requirement of raw material were met through imports, which currently have been reduced to about 40 % percent due to increased production of indigenous raw materials. The major raw materials produced locally include Mineral, Turpentine, Resins, Vegetable Resins and Gums, whereas raw material such as Pigments, Zinc Oxide, Titanium oxide and Lithopone are imported. Paint is categorized in two broad classes namely water based pain and solvent based paint. The industries produce a wide range of finish and intermediate products which pigments, distempers, plastic emulsion, enamel, undercoat, primers, rubber paint, aircraft paint, marine paint, anticorrosive paint, anti fouling paint, etc. BMA Capital forecast the future of Paint industry in their annual report they suggest that “Paints is another segment which can be adversely impacted by economic slowdown as growth contracts in the construction and auto industries. The company however, stands to benefit from new parent Akzo Nobel whose expertise lies in decorative paints and will allow it to expand its portfolio. ICI plans to export paints to Iran and Afghanistan as well which will help them to sustain profitable in current turmoil. The joint ventures and calibrations with international players are strengthening the industry and providing more varieties of paints to the customers. Last year, the Asian Paints made an indirect entry into Pakistan, through a technical consultancy tie-up between Berger International Singapore – a company it acquired in 2002--and Berger Paints Pakistan. This tie-up will allow Berger Paints Pakistan to access product technologies and products from the Asian Paints group.
Here are some statistics about paint industry;
- There are around 22 units in the organized and over 400 units in the unorganized sector for the manufacturing of paints and varnishes.
- Around 50 percent of the domestic demand for paints and varnishes is met through production in the organized sector while the remaining comes from the unorganized sector.
- The per capita consumption of paints in Pakistan is low at 0.8 kg per annum compared to 4 kgs in the South East Asian nations, 22 kg in the developed world and 15 kg per capita for the world.
- The demand for paints and varnishes is rising due to the resurgence of housing and construction sector.
- During July-March, 2007-08, the production of paints and varnishes both solid and liquid grew by 9.9 percent and 8.2 percent, respectively.
- At a time when the sales volumes of all the paint makers have been booming because of the resurgence of the housing and construction sector, price factors are a major component of a company's competitiveness in the in the market, irrespective of the quality of the paints supplied.
- No doubt the mushrooming growth of paint makers in the informal sector has provided much relief to the lower and middle income group people who could not afford to buy costly paints produced by some multinationals and others.
- However, price-conscious consumers are still bound to compromise on the quality factor despite benefiting from the saving in terms of rupee while buying mediocre quality paints that are not long-lasting.
- Berger Paints, Buxley Paints and ICI Paints all reported improved sales volume. Berger sales volume increased to Rs8.53m from Rs6.87m in the previous fiscal year. Despite increased expenses incurred to increase their market presence, the company achieved 63% higher profits of Rs33m.
- Net sales of Buxly Paints in July-March 2003-04 stood at Rs122m against Rs103m in the corresponding period of previous fiscal, while ICI's turnover in the first quarter of 2004 stood at Rs796 million as against Rs638 million while operating profit rose to Rs102m from Rs90m over the same period last year.
- These companies expect a good level of demand for both decorative and industrial paint in the future but said that margins are coming under pressure from raw material cost increases.
PAINT MARKET STRUCTURE
- Only two major players in the market – ICI and Berger
- The ICI has market share of 22 % while Berger have 15 %. While 65 % is acquired by mushrooms
- Mushrooms are of two types - organized and unorganized.
- Organized mushrooms are small companies who have improved their manufacturing style. These companies are ISO certified and cater to lower socio-economic classes. They tend to spend money on advertising and make their presence felt through the media.
- Unorganized mushrooms are small companies, whose operation is restricted to their respective localities only, they lack quality assurance and quality control measures and do not provide after sales service.
- Only one other major player, a company by the name of JOTUN which is a UAE based company and imports directly from Dubai but only targets architects and interior designers.
- Another big player, Nippon Paints has recently started setting up its operations in Pakistan. It will be a while before Nippon becomes a threat for ICI.
No comments:
Post a Comment