Berger Paints India Ltd is looking into various options of roping in foreign technology for its automotive paints business, according to K S Dhingra, chairman of the company. He was talking to reporters at the end of the 73rd annual general meeting of the company.
Refusing to divulge the names of the foreign companies shortlisted for the purpose, he said that this could be in the form of a joint venture or simply a technological tie-up with the foreign firm.
The company is gearing up to meet the ever growing demand in the automobile sector, Subir Bose, managing director of the company, said.
At present India is producing 400,000 cars and this figure will go up to 700,000 in the year 2000, he said. Berger wants to acquire adequate technology and infrastructure to meet these requirements.
The company has collaborations with Herberts of Germany for automotive paints and Tudor NV of Holland for powder coating.
With 10 per cent market share in automotive paints, Berger supplies to companies like Ashok Leyland, Mitsubishi, Hindustan Motors, Premier Automobiles and Kinetic Honda. It will also start supplying to new models of Mercedes coming up in September.
The company is quite optimistic about the current year. Last year was not a good year for the paints industry, the average growth being eight per cent. Bergers performance in the first quarter of the current year is better than the previous quarter.
Earlier, addressing shareholders at the AGM, Dhingra announced that the Pondicherry plant of the company has commenced operation. The plant will mainly cater to the southern market, that represents the highest per capita consumption of paints.
Hence, the company has planned to focus on the southern market which was so long catered by Berger subsidiary Beepee Coatings Ltd in Gujarat and Bergers own Howrah plant. Berger has also put its endeavour to reduce costs.
Announcing the financial results for 1996-97 at the AGM, Dhingra said, the companys performance has been better than the industry average. The companys turnover increased 13 per cent to Rs 311.54 crore from Rs 277.27 crore in the previous year., while volume by sales increased by 10 per cent.
Net profit increased by 40 per cent to Rs 18.31 crore from Rs 11.89 crore in the previous year. The annualised earning per share is Rs 16.44. The companys dividend increased from 50 per cent to 60 per cent.
With this performance Berger now ranks third in the paints industry after Asian Paints and Goodlass Nerolac. It is closely followed by ICI. With a dealer network of 10,000 in India, the company ranks second in the decorative paints segment.