Being severely hit by the significant crude oil price hike that breached $70 a barrel, the Indian paints industry is all set for another price hike within the next month. |
The industry was significantly hit with price of major raw materials going up around 5-7 per cent. |
"We will be increasing prices of our solvent based products by 3-4 per cent by the end of May. This will increase prices by Rs 4 per litre," said Subir Bose, managing director, Berger Paints. Around 50 per cent of the Rs 9,000 crore paints industry was solvent based, he said. |
Shalimar Paints Ltd is considering a similar move. "We are thinking of a price hike in the first week of June. We were hit to the tune of 12 per cent owing to rise in crude oil price. |
Prices of solvent based products might go up by 5-7 per cent," said S L Agarwal, managing director, Shalimar Paints Ltd. |
Ashim K Mukherjee, chief of operation, Jenson & Nicholson (India) Ltd informed that under severe competition in the Indian paints market, the cost hike had nearly wiped out all its margin. |
"Margins are nearly zero owing ta the crude oil price hike. We are waiting for the leaders in the industry to make the first move and we will be following them," he added. |
Industry experts though were of the opinion that such a move was perhaps not urgently required taking the complete scenario into consideration. |
"Import duty on most of the raw materials have been slashed down to 12.5 per cent from the previous figure of 15 per cent. |
Prices of polymers have been remaining steady. Keeping all these in mind, an immediate price hike might not be required," said an industry source. |
The industry saw a similar hike in December 2005, when prices of solvent paints prices went up by four per cent. |