1.

Asian Paints International (API) is a wholly owned subsidiary of Asian Paints Limited, which is
Asia’s second largest paint company and the world’s seventh largest paint company. API was
established in 2002 to expand the presence of Asian Paints in the emerging markets. API operates in
four regions: South Asia, Middle East, South Pacific and Africa, servicing consumers in over 60
countries.

2. Asian Paints pursued the expansion into the international markets through a combination of
greenfield ventures, acquisitions and joint ventures.

 The company followed a three-pronged growth strategy: market expansion, acquisition and
outsourcing.
 The company also leveraged its expertise in decorative paints, colour technology and supply
chain management to gain a competitive edge in the global markets.

3. Asian Paints currently operates in 15 countries with 27 paint manufacturing facilities across the
world. The countries are: India, Bangladesh, Egypt, Oman, Bahrain, UAE, Sri Lanka, Nepal, Fiji,
Indonesia, Ethiopia, Kenya, Tanzania, Singapore and Malaysia.

4. The various other brand names on their website are the names of the subsidiaries or joint venture
partners of Asian Paints in different regions. They are associated with Asian Paints through
shareholding agreements or strategic alliances. Here is a brief overview of each brand:

 KADISCO: It is a paint and adhesive company based in Ethiopia. Asian Paints acquired a
majority stake in Kadisco in 2015 to enter the African market.
 SCIB Paints: It is a leading paint company in Egypt. Asian Paints acquired SCIB Chemicals SAE
in 2002 to strengthen its presence in the Middle East.
 Asian Paints Berger: It is a joint venture between Asian Paints and Berger International
Limited, a Singapore-based paint company. Asian Paints Berger operates in Bahrain, Oman
and UAE.
 TAUBMANS: It is a leading paint brand in Australia and New Zealand. Asian Paints acquired
Taubmans in 2003 through its subsidiary Apco Coatings.
 Apco Coatings: It is a subsidiary of Asian Paints that operates in South Pacific region. Apco
Coatings has manufacturing facilities in Fiji, Tonga, Solomon Islands and Vanuatu.
 Asian Paints: It is the flagship brand of Asian Paints Limited that operates in India and other
South Asian countries like Bangladesh, Nepal and Sri Lanka.
 CAUSEWAY Paints: It is a leading paint company in Sri Lanka. Asian Paints acquired Causeway
Paints in 2016 to consolidate its position in the South Asian market.

5. According to the latest annual report of Asian Paints Limited, the revenue from international
operations for the financial year 2020-21 was Rs 1,860 crore, which accounted for 6.4% of the total
revenue from sale of products and services. The revenue from domestic operations for the same
period was Rs 27,063 crore, which accounted for 93.6% of the total revenue from sale of products
and services6. Thus, the revenue from domestic operations was significantly higher than the revenue
from international operations.

6.The most profitable market for the company is India, where it has a dominant market share of over
50% in the decorative paints segment. India also contributes to the majority of the company’s
revenue and profit. According to the latest annual report of Asian Paints Limited, the profit before
tax from domestic operations for the financial year 2020-21 was Rs 5,433 crore, which accounted for
96.8% of the total profit before tax6. The profit before tax from international operations for the
same period was Rs 177 crore, which accounted for 3.2% of the total profit before tax.
7. The mode of entry adopted by the company in different countries varies depending on the market
potential, competitive landscape and regulatory environment of each country. Some of the modes of
entry used by the company are:

 Greenfield ventures: This mode involves setting up a new plant or facility from scratch in a
foreign country. The company has used this mode to enter markets like Bangladesh,
Indonesia and Fiji.
 Acquisitions: This mode involves buying an existing company or a stake in it in a foreign
country. The company has used this mode to enter markets like Egypt, Ethiopia and Sri
Lanka.
 Joint ventures: This mode involves forming a partnership with another company or entity in
a foreign country. The company has used this mode to enter markets like Bahrain, Oman and
UAE.

8. The risks which the company has faced in different markets are:

 Growth prone to slowdown effects: The demand for paints and coatings is dependent on the
economic growth and development of the countries where the company operates. Any
slowdown or recession in these countries can adversely affect the sales and profitability of
the company.
 Stringent government rules and regulations: The paint industry is subject to various
environmental, health and safety regulations in different countries. These regulations can
impose restrictions on the quality, production, distribution and disposal of paints and
coatings. The company has to comply with these regulations and incur costs for ensuring
compliance.
 Raw material scarcity and volatility in prices: The paint industry relies on various raw
materials like titanium dioxide, solvents, resins, pigments and additives. These raw materials
are subject to fluctuations in availability and prices due to factors like supply-demand
dynamics, exchange rates, geopolitical events and natural disasters. The company has to
manage its raw material procurement and inventory efficiently to avoid disruptions and cost
escalations.
 Rivalry among competitors: The paint industry is highly competitive and fragmented in
different regions. The company faces competition from both local and global players who
offer similar or substitute products and services. The company has to maintain its product
quality, innovation, customer service and brand image to differentiate itself from its
competitors and retain its market share.
 A threat by substitutes: The paint industry is exposed to the threat of substitution by
alternative products and technologies that can offer better performance, durability,
aesthetics or environmental benefits. For example, powder coatings, water-based coatings,
digital printing and nanotechnology are some of the potential substitutes that can challenge
the traditional paint products and applications. The company has to keep abreast of the
changing customer preferences and technological advancements and invest in research and
development to offer new and improved products and solutions.

9. Yes, the company has exited some of the markets after entry due to various reasons. For example:

 China The company exited its operations in China in 2010 due to low profitability and high
competition. The company sold its 49% stake in Asian Paints (China) Co Ltd to its joint
venture partner Berger International Ltd.
  Thailand: The company exited its operations in Thailand in 2010 due to low market share
and high operational costs. The company sold its 100% stake in Asian Paints (Thailand) Ltd to
Nippon Paint Co Ltd.
 Malaysia: The company exited its operations in Malaysia in 2016 due to low growth potential
and strategic realignment. The company sold its 51% stake in Asian Paints (Malaysia) Sdn
Bhd to Berger International Ltd.
 Hong Kong: The company exited its operations in Hong Kong in 2016 due to low growth
potential and strategic realignment. The company sold its 100% stake in Asian Paints (Hong
Kong) Ltd to Berger International Ltd.

10. The expansion plans of the company are:

 To set up a new plant to produce vinyl acetate ethylene emulsion (VAE) and vinyl acetate
monomer (VAM) in India with an investment of Rs 2,100 crore. This plant will help the
company to reduce its dependence on imports of these key raw materials for paints and
coatings.
 To set up a white cement plant in UAE with an investment of Rs 550 crore in partnership
with two local firms. This plant will help the company to cater to the growing demand for
white cement-based products like wall putty, tile adhesive and grout in the Middle East
region.
 To increase the manufacturing capacity of its facility at Ankleshwar in Gujarat with an
investment of Rs 960 crore. This facility will produce decorative paints, industrial coatings
and intermediates for both domestic and international markets.
 To set up a new paint manufacturing plant at Mandsaur in Madhya Pradesh with an
investment of Rs 2,000 crore. This plant will have a capacity of 4 lakh kilo litres per annum
and will produce decorative paints for the Indian market.

11. My learning from the assignment are:

 Asian Paints is a leading paint company that has successfully expanded its presence in the
international markets through various modes of entry.
 Asian Paints has a diversified portfolio of products and services that cater to different
segments of customers across regions.
 Asian Paints has a strong focus on innovation, quality, customer service and brand image
that differentiate it from its competitors.
 Asian Paints has a robust risk management framework that helps it to identify, assess,
mitigate and monitor the key risks affecting its business.
 Asian Paints has a vision to become one of the top five decorative coatings companies
worldwide by leveraging its expertise in the higher growth emerging markets.