Berger Paints eyes Rs 10,000 crore turnover in three years

Berger is also growing its international presence, major contributor to the growth would be the India market and drivers would be the decorative, protective, construction chemicals segments

Berger Paints, the country’s second largest paints maker in the decorative segment, is eyeing a consolidated turnover of Rs 10,000 crore in three years when it turns 100. In FY21, it had clocked in a turnover of around Rs 6,800 crore.

Though Berger is also growing its international presence, the major contributor to the growth would be the India market and the drivers would be the decorative, protective and construction chemicals segments.

It’s doable, said, Abhijit Roy, managing director and chief executive officer, Berger Paints. Berger will be in its 100th year in 2023-2024, which is when the company is hoping to touch the Rs 10,000 crore turnover-mark.

Roy is banking on value and volume growth to achieve the target. “This year, we will try and touch Rs 8,000 crore,” he said.

Raw material prices have been increasing and Berger has been increasing prices. Since May, the company has undertaken a series of price increases and the last one is due on September 1.

“From the time we started, till September 1, we would have increased prices by about 6.5 per cent. That would more or less cover price increases that have happened on the raw material side,” Roy explained.

That will stem the gross margin contraction from the third quarter onwards. “It will be more or less neutralized,” said Roy.

Berger’s net profit on a standalone basis in the first quarter was at Rs 135.09 crore, which was lower than Q4 net profit at Rs 184.69 crore.

On the business side, Berger is pinning hopes on three big opportunities to achieve its turnover target. In the decorative segment - which is Berger’s core competence – the company is looking to plug gaps in distribution.

“In the protective coating space, we are the leader. There is a lot of investment going into infrastructure, we hope to get a good share of the business,” explained Roy.

The other area, which is growing fast for Berger, is construction chemicals. “We are confident that we will be among the top three in the country as far as construction chemicals space is concerned in the next two years,” added Roy.

The international business is also on an expansion mode, which will be driven by Bolix, primarily into external thermal insulation coatings. It is looking to enter France and Switzerland and has already appointed distributors.

“Bolix Europe will now control Poland, Russia, UK and subsequently even France and Switzerland, that is what we are looking at,” said Roy.

In 2008, Berger had acquired Poland-based Bolix SA, a leading provider of external insulation finishing system. The acquisition marked Berger's entry into the European Union market.