Merrill Lynch India Investor Conference

New Delhi

February 16, 2016

Disclaimer
This presentation may contain statements which reflect Managements
current views and estimates and could be construed as forward
looking statements. The future involves certain risks and uncertainties
that could cause actual results to differ materially from the current
views being expressed. Potential risks and uncertainties include such
factors as general economic conditions, foreign exchange fluctuations,
competitive product and pricing pressures and regulatory
developments.
Responses can only be given to questions which are not price
sensitive.

Agenda
Group Overview

Economic Environment Q3 & 9M FY16

Financial Performance Q3 & 9M FY16
Business Review Q3 & 9M FY16

Risks and Outlook

Asian Paints Group Today

Over
No.

Paint Company
in India

rd

Largest Paint

Company in Asia

11th Largest Coating

USD

Billion

Group revenue

Operations in

19
countries

Part of

3
Times nearest
Competitor in India

26
Paint
Manufacturing
Plants

30

share

BSE
S&P SENSEX

47
Years of Market
Leadership in India

Company In the World

Forbes Asias Fab

50
Company; Four
times in a row

Part of NSE Nifty

50

Servicing
Consumers in over

65
Countries

7000
Employees
worldwide

Global Standing
16.0
14.3
14.0

In Billion USD

12.0
10.0

11th largest in the World

11.6

10.0

8.0

2nd largest in Asia

6.4
6.0
4.5
4.0
2.0
-

4.4

4.4
3.6

3.1

2.9

2.3

2.3

2.1

2.1

2.0

1.7

1.7

1.5

1.0

1.0

* Coatings World 2015 Top companies report

Worldwide Operations

Jamaica

Egypt
Barbados

Trinidad & Tobago

Ethiopia

Bahrain
UAE
Oman

Nepal
India

Bangladesh

Sri Lanka

Singapore
Indonesia
Solomon Islands
Vanuatu
Samoa
Fiji
Tonga

Strong Brands

Aspiration

To be the fore runner of inspiring dcor and to actively

empower customers to create their dream homes

Stand for
Belief in fostering the principles of trust and transparency
Ability to adapt itself to the changing environment
Dynamic professional management team focused towards delivering stakeholder

value with highest levels of corporate governance

Innovative strategies in the marketplace
Efficient manufacturing and logistics
Capabilities to effectively harness Information Technology to improve efficiency in
operations (SAP, i2, etc.)

Prudent management of financial resources

Focus on Research and Development (dedicated group R & D centre in India at
Turbhe near Mumbai)

Innovative Market place Strategies

Small Packs
Exterior Paint Segment
Consumer and Dealer helpline

Colour Next (Prediction of Colour trends through in-depth research

Special effect and textured paints
Signature Stores
Colour Ideas store
Samplers
Beautiful Homes Guide
Water Proofing and Wallpaper business
Ezycolour Service brand

Home Solutions (Painting solution service)

Colour Consultancy @ Home

Powerful Consumer Connect

Signature Stores in Metros

Colour Ideas Stores

Innovative retailing strategy showcasing latest product and solution offerings

enabling consumers to get inspired, try and decide
Strong presence in all product segments, servicing over 35,000 dealers

Robust Supply chain and IT

State of the art Supply Chain system using cutting edge latest technology for efficient
management and execution
World Class, large manufacturing facilities with latest automation technologies
Largest single location paint manufacturing capacities at Rohtak (Haryana) and Khandala,
(Maharashtra). Both these plants can be scaled up to 4,00,000 KL p.a.
Planning to set up a new, fully-automated manufacturing facility over the next 2-3 years
Strong distribution and logistic network across geographies using modern material storage and
handling technologies

Dedicated in-house IT team adding value to business process in terms of higher productivity,
lower costs, speed, consistency and standardization

Dedicated R&D
Dedicated Research and Technology facility at Turbhe
(Near Mumbai) with over 150 scientists
Supports company strategy around Technology
development, Sustainable new products, Green
products, Value re-engineering for productivity
improvement and cost optimization

Our scientists had won the Roon award in 2013 one

of the highest technical achievements in the coatings
industry

Changing with times

Business Portfolio
Decorative Coatings India
Industrial Coatings India
PPG Asian Paints

13%
1%

5%

Asian Paints PPG

International Operations
Home Improvement Business India
81%

Sleek
ESS ESS
Chemical Business

Decorative - India

Home Improvement - India

Industrial - India

International Operations

FY 2014- 2015

Decorative Coatings - India

Largest business unit of the company

Primarily operates in four segments

Interior Wall finishes
Exterior Wall finishes

Metal Finishes (Enamels)

Wood Finishes
Introduced new categories like water-proofing & wallpapers

Product for every price point and requirement

Industrial Coatings - India

Asian Paints participates in the Industrial Coatings segment, through two 50:50 JVs with PPG Inc. of USA

PPG Asian Paints (For Auto Coatings)

The Auto segment is catered through our JV (PPG AP)
Second largest supplier to the auto segment in India

Now, the largest player in auto refinish segment, post acquisition of ICI Indias 2k auto refinish
business in 2007
Commissioned a 3,200 KL / year plant in Chennai, Tamil Nadu in 2008

Asian Paints PPG (For Non Auto Industrial Coatings)

Protective coatings, floor coatings, road marking paints and powder coatings segment catered to
by this JV
Services customers in the sectors of Infrastructure, Oil & Gas, Power Plants, White Goods, etc.

International Operations
1.6%

Contributes about 13% to the group turnover

Began by establishing presence in Fiji in 1978

7.0%

11.8%

31.0%

48.6%

Presence in 19 countries spread over 5 regions

Caribbean : Jamaica, Barbados and Trinidad & Tobago
Middle East : UAE, Bahrain, Oman & Egypt

Caribbean

Asia : Nepal, Sri Lanka, Bangladesh, Singapore & Indonesia

Middle East

South Pacific

FY 2014- 2015

South Pacific : Fiji, Tonga, Solomon Islands, Vanuatu & Samoa

Africa : Ethiopia

Focus on establishing presence and growing in high growth emerging markets

Looking for expansion in key markets of Africa and South East Asia
Acquired 51% stake in Kadisco Chemical Industry PLC, Ethiopia in Feb 2015

Setting up paint manufacturing facility at Indonesia

Asia

Africa

Home Improvement Business - India

In 2012, Asian Paints announced plans to consider opportunities in the area of Home Improvement
and Dcor
Entered Kitchen space in India in Aug13 by acquiring 51% stake in Sleek International
Sleek is a major organized player in the modern kitchen solution space with pan India
presence
Engaged in the business of manufacturing, selling and distributing kitchens, kitchen
components including wire baskets, cabinets, appliances, accessories etc.
Retail network of more than 30 showrooms including shop-in-shops and 250+ dealers
Entered the Bathroom fitting business in June14 through acquisition of front end sales business
(including brands, network and sales infrastructure) of ESS ESS Bathroom products Pvt Ltd
ESS ESS is a prominent player in the bath business segment in India and has high quality
products in this segment

Chemicals
Asian Paints manufactures Phthalic Anhydride (PAN) and Pentaerythritol (Penta)
PAN manufactured in Gujarat and Penta in Tamil Nadu
More than 50% consumed internally

Contributes about 1% to the groups consolidated revenue

Contribution to the groups revenue has been continuously decreasing

Consistent performance
Consolidated Net Sales and
Operating Income ( ` Crores)

Net Profit (` Crores)

1,395
1,400

14,183

16,000

1,200

14,000
12,000
10,000

1,000
CAGR
18.6%

800

8,000

CAGR
23.1%

600

6,000
4,000

400

2,574

174

200

2,000

0
2004-05

2014-15

2004-05

2014-15

Sustained value creation...

Market Cap (` Crores)

60%

50%

7,000

3,751

30%

4,000

20%

3,000

10%

2,000

2013-14

2014-15

2012-13

2004-05

2009-10

2008-09

0%

1,000

2007-08

5,000

53%

46%

51%
47% 49%

39%

40%

2006-07

6,000

52% 51% 54%

2014-15

CAGR
35.42%

2005-06

8,000

60%

2004-05

9,000

70%

73%

2011-12

10,000

80%

2010-11

77,820

Dividend Payout Ratio

Recent Accolades
Felicitated as one of the Most Impactful Companies of the Decade by CNBC Awaaz in Jan 2015
Included in Forbes Indias List of Super 100 companies in India in 2015
Included in Forbes Magazine's Asia's Fab 50 List of cos 4 years in a row from 2011 to 2014
Rated as the 6th Most Valuable Brands in India Aug 2014 (Compiled by marketing and brand
consultancy Millward Brown and WPP Group)
Ranked as the 4th Most Admired Company in the FMCG Sector by Fortune India Aug 2014
Presented with the Asian Centre for Corporate Governance & Sustainability Award for the Best
Governed Company in 2011
Asian Paints receives the Best Audit Committee Award from the Asian Centre for Corporate
Governance & Sustainability in 2011
Sword of Honour" by the British Safety Council for all the paint plants in India, considered as the
pinnacle of achievement in safety across the world

Presentation structure
Group Overview

Economic Environment Q3 & 9M FY16

Financial Performance Q3 & 9M FY16
Business Review Q3 & 9M FY16

Risks and Outlook

Economic Environment
Challenging business environment with domestic economic activity showing signs of
modest improvement
GDP growth projections lowered to 7-7.5% from earlier forecasts of 8%
Industrial production data points to a slow recovery with the Apr15-Nov15 industrial
growth at 3.9% as against 2.5% in the same period last year
Inflation trend remains soft but has picked up in the third quarter on account of rising
food prices

On the global front, uncertainty around US Interest rate hike is finally behind us

However, Chinese economy slowdown has added to volatility, especially in all the
emerging markets
Oil Prices continued to fall further and are currently trading at decade low levels

Presentation structure

Group Overview

Economic Environment Q3 & 9M FY16

Financial Performance Q3 & 9M FY16
Business Review Q3 & 9M FY16

Risks and Outlook

Financials : Q3 & 9M FY16

Growth over Last Year

Standalone Revenue Growth Trend

Presentation structure
Group Overview

Economic Environment Q3 & 9M FY16

Financial Performance Q3 & 9M FY16
Business Review Q3 & 9M FY16

Risks and Outlook

Business Review : Q3 & 9M FY16

DECORATIVES BUSINESS
Decorative Paints business in India registered double digit volume growth in Q3FY16 aided
by festival season demand due to a later Diwali
Festival season demand was staggered over second and third quarter in Q3FY15
South India especially Tamil Nadu was adversely affected due to high rainfall
Material prices dropped further in the quarter

No price revision affected in Q1FY16, Q2FY16 & Q3FY16

Cumulative price increase of 0.39% for FY15 against increase of 6.25% in FY14
Increased prices by 1% on 1st May14 & 1.2% on 1st June14
Price Reduction of 1.95% wef 11th Feb15

Business Review : Q3 & 9M FY16

DECORATIVES BUSINESS
Continued focus on network expansion and opening new Colour Ideas store
Over 32,500 Colour Worlds & 270 Colour Ideas stores across the country

Waterproofing range of products continues to witness good acceptance in the market

Capex for FY16 estimated at ` 700 crores

Rohtak plant expansion work from 200,000KL/annum to 400,000 KL/annum is in the

final stages and expected to be completed by the end of the current financial year

Business Review : Q3 & 9M FY16

INDUSTRIAL BUSINESS
Automotive coatings JV (PPG-AP), registered decent growth in Auto OEM and Refinish
segment in the quarter
The General Industrial business segment continues to lag
Good Pickup was seen in the Industrial Liquid and Powder coatings segment of the
Industrial Coatings JV (AP-PPG) in the quarter
Lower material prices aided margins for both these businesses

INTERNATIONAL BUSINESS
International business reported double digit growth in the quarter aided by contribution
from some of the units in Middle East and in Bangladesh
Business in Ethiopia, which was acquired in Feb 2015, also continued to grow well

Business Review: Q3 & 9M FY16

HOME IMPROVEMENT BUSINESS
The Kitchen (SLEEK) and Bath (ESS ESS) business has been co-branded with Asian Paints
The Kitchen business continues to be impacted by the subdued demand conditions
prevailing over the last couple of years
The management has been working on expanding the network and streamlining the
business model. While we have made progress in this direction since acquisition, the pace is
slower than what we had envisaged earlier. The management has made an assessment of
the fair value of investment made in Sleek taking into account the past business
performance, prevailing business conditions and revised expectations of the future
performance given the understanding built up since acquisition. Based on the above factors
and as matter of prudence, the company has made a provision for diminution in the value of

the investment made in Sleek to the tune of ` 65.30 crores. The same is disclosed as
exceptional item in the financial results for the Quarter.

The Bath (ESS ESS) business registered good growth aided by expansion of network
Unexpectedly high rainfall in some key markets in South India affected the business

Presentation structure
Group Overview

Economic Environment Q3 & 9M FY16

Financial Performance Q3 & 9M FY16
Business Review Q3 & 9M FY16

Risks and Outlook

Risks & Outlook

Going forward, We continue to remain fairly cautious on the domestic demand outlook
Raw material prices are expected to remain low in the near term and support margins

In the international markets, we need to look out for improvement in certain key
markets like Nepal and Egypt to sustain the growth momentum
Additionally, units in Egypt and Ethiopia could be impacted on account of raw
material shortage arising out of unavailability of foreign exchange

Thank you

Annexures Q3 & 9M FY16 Results

Consolidated P&L : Q3 & 9M FY16

(Rs. in Crores)
Total Income from Operations
Material Cost
Employee cost
Other Expenses
PBDIT
Depreciation
Proft from Operations
Other Income
PBIT
Finance Cost
PBT before EOI
Exceptional Item
PBT
Curr. & Def Tax
PAT before Minority interest
Minority Share
PAT to parent Shareholders

YTD Dec'15 YTD Dec'14 Gr %

Q3 - FY 16 Q3 - FY 15 Gr %
8.6%
10,647.8
11,562.9
13.9%
3,652.6
4,160.0
2.5%
6,029.6
6,178.6
7.2%
2,051.7
2,200.4
7.3%
690.7
741.2
6.5%
231.9
247.0
12.7%
2,252.0
2,538.1
16.4%
783.9
912.1
25.6%
1,675.5
2,104.9
36.8%
585.0
800.6
7.0%
198.8
212.7
7.7%
67.3
72.5
28.1%
1,476.7
1,892.2
40.6%
517.7
728.1
30.2%
128.1
166.8
17.3%
30.5
35.8
28.3%
1,604.8
2,059.0
39.3%
548.2
763.9
4.8%
24.6
25.7
-22.2%
9.8
7.6
28.7%
1,580.2
2,033.2
40.5%
538.4
756.3
108.5%
25.2
52.5
#DIV/0!
52.5
27.4%
1,555.1
1,980.8
30.7%
538.4
703.8
30.0%
479.7
623.8
37.2%
166.7
228.8
26.2%
1,075.3
1,357.0
27.8%
371.7
475.0
86.9%
21.2
39.5
231.4%
3.5
11.7
25.0%
1,054.2
1,317.5
25.8%
368.2
463.3

Standalone P&L : Q3 & 9M FY16

(Rs. in Crores)
Total Income from Operations
Material Cost
Employee Remuneration
Other Expenses
PBDIT
Depreciation
Proft from Operations
Other Income
PBIT
Interest
PBT before Exceptional Item
Exceptional Item
PBT
Taxation
PAT
EPS

YTD Dec'15 YTD Dec'14 Gr %

Q3 - FY 16 Q3 - FY 15 Gr %
7.6%
8,761.9
9,426.8
13.2%
3,025.4
3,424.0
0.9%
4,879.8
4,922.0
6.0%
1,669.7
1,769.3
5.2%
461.4
485.6
4.2%
153.9
160.4
13.0%
1,910.8
2,159.8
18.1%
660.1
779.6
23.2%
1,509.8
1,859.4
31.9%
541.7
714.6
5.1%
167.6
176.1
6.3%
56.5
60.1
25.4%
1,342.2
1,683.3
34.9%
485.2
654.4
32.2%
137.4
181.7
33.2%
35.4
47.2
26.0%
1,479.6
1,865.0
34.8%
520.7
701.7
-29.3%
18.5
13.1
-26.1%
7.8
5.8
26.7%
1,461.1
1,851.9
35.7%
512.8
695.9
159.5%
25.2
65.3
#DIV/0!
65.3
24.4%
1,435.9
1,786.6
23.0%
512.8
630.6
28.5%
448.4
576.1
32.9%
159.8
212.4
22.6%
987.6
1,210.5
18.4%
353.1
418.2
10.3
12.6
3.7
4.4

Key Ratios
Standalone
% to Income from Operations

Material Cost
PBDIT
PBT After Exceptional Item
PAT

Q3 - FY 16

51.67%
20.87%
18.42%
12.21%

Standalone

Consolidated

Q3 - FY 15 YTD Dec'15 YTD Dec'14 Q3 - FY 16

55.19%
17.91%
16.95%
11.67%

52.21%
19.72%
18.95%
12.84%

55.69%
17.23%
16.39%
11.27%

52.89%
19.24%
16.92%
11.42%

Consolidated

Q3 - FY 15 YTD Dec'15 YTD Dec'14

56.17%
16.02%
14.74%
10.18%

For Consolidated results, PAT is before Minority Interest

53.44%
18.20%
17.13%
11.74%

56.63%
15.74%
14.60%
10.10%