As part of its diversification into consumer-facing businesses, JSW group is entering the paints business with an initial investment of Rs 600 crore, which swell to Rs 1,000 crore over the next 18 months.
The group Thursday announced a new venture, JSW Paints, which will begin commercial operations from September and aims to clock Rs 2,000 crore of topline by FY22.
The new company will manufacture and market industrial coil coatings and decorative paints at its two plants in Maharashtra and Karnataka.
The company has set up a fully automated water-based decorative paints plant with 100,000 kilolitres capacity at Vijaynagar in Karnataka and an automated coil coatings facility with an annual capacity of 25,000 kilolitres at Vasind in Maharashtra.
"We have entered the paints industry with the soft- launch in Bengaluru and Hubballi and plan to cover the whole of the Southern and Western markets by September," JSW Paints managing director Parth Jindal told reporters.
He also said the company has already invested Rs 600 crore which will go up to Rs 1,000 crore over the next 18 months, as they plan a pan-India play within three years.
"We have set a revenue target of Rs 600 crore in the first year, and Rs 2,000 crore by FY22. We expect 75 per cent of sales to come in from the decorative segment and the rest from industrial coating," he said.
Over the past seven years, the paints industry has doubled to Rs 50,000 crore, with the organised segment contributing 75 per cent of this, he said.
"We believe that in the next seven years or even before, the industry can be an Rs 1,00,000-crore industry," Jindal said.
The company expects a market share of 5 per cent in the next three years in the decorative paint business and double it by the end of the fifth year.
It plans to double the decorative paint capacity to 2,00,000 KL in the next 18 months, Jindal said, adding the Vasind plant will cater to all the requirements of JSW Steel.
"JSW Steel is the largest supplier of colour coated steel in the country with a market share of close to 20 per cent. This is poised to increase as the company is increasing its current capacity from 0.7 million tonne to 2 million tonne over the next 18 months.
This capacity will consume close to 40,000 KL of paints annually, he said adding the paints business will also cater to the requirements of other steelmakers.
"We very confident that within the next two quarters about 20 per cent of our sales will happen from customers other than JSW Steel," he said.
Company's joint managing director AS Sundaresan said they would look at exporting its industrial coating paints to the Middle East and Africa from later this year.