Dulux to look at major distribution in the smaller towns for greater margins

Akzo Nobel India which has been present in India for over 60 years and is a significant player in the paints industry and their portfolio includes well-known brands such as Dulux, Sikkens, International and Interpon, recorded sluggish growth in Q1. The net sales were at ₹783 crore as compared to ₹773 crore of the corresponding quarter of the previous year and profit after tax is at ₹41 crore as compared to ₹64 crore of the corresponding quarter of the previous year. AkzoNobel is a prominent name in the Decorative Paints and Performance or Industrial Coatings and Specialty Chemicals. AkzoNobel has been getting a major growth from their value for money brand products like Dulux Promise which was launched sometime back as a pilot and is soon going to escalate the advertising and marketing strategies for the same and will be looking at major retail distribution of the same in the smaller towns of India. At present the company has 145 Dulux Decoration Centres or DDC’s where the customers can walk in and get every suggestion related to decorative paints and their requirements are addressed by the experts from Dulux team.

In the press conference Jayakumar Krishnaswamy, Managing Director, AkzoNobel India shares, “The quarter’s performance has been impacted due to slow sales growth and higher input prices. The process towards the transition to GST also had an adverse impact. We have transitioned smoothly to the GST environment with zero disruption to business operations. With good monsoons and the markets picking up post introduction of GST, we expect improved sales performance in the coming months. We continue to invest in growth as per our strategy, with an anticipated capital spend of ₹80-100 cr in the current year. This would include commissioning of Powder Coatings facility and expansion of digital marketing and colour solutions machines in customer facing areas.”

Amit Jain, who has taken over as Non-Executive Chairman of its Board from 15 August 2017 shares, “From Dulux we have all kinds of ranges be it premium or mid level and mass market product portfolio. Since last few years we have observed that the tier II and III cities are growing immensely and we have got a very good growth rate from these markets. Now we are looking at major distribution and dealer networks ,digital marketing solutions and are going to advertise the concept of DDC’s which are present in big cities as well through prominent platforms. Close to 100 crore of budget has been allotted for this and since last five years we already invested an amount of 300 crores in the Indian market. We anticipate that greater growths are going to come from the smaller towns of India as we can provide products which give value for