ORIGINAL ARTICLE

ISSN No : 2249-894X

Monthly MultidisciplinaryResearch Journal

Review Of Research Journal

Vol 4 Issue Feb 20155

Chief Editors

Ashok Yakkaldevi A R Burla College, India

Flávio de São Pedro FilhoFederal University of Rondonia, Brazil

Ecaterina PatrascuSpiru Haret University, Bucharest

Kamani PereraRegional Centre For Strategic Studies,Sri Lanka

Horia PatrascuSpiru Haret University, Bucharest, Romania

Delia SerbescuSpiru Haret University, Bucharest, Romania

Xiaohua YangUniversity of San Francisco, San Francisco

Karina XavierMassachusetts Institute of Technology (MIT), USA

May Hongmei GaoKennesaw State University, USA

Marc FetscherinRollins College, USA

Liu ChenBeijing Foreign Studies University, China

Mabel MiaoCenter for China and Globalization, China

Ruth WolfUniversity Walla, Israel

Jie HaoUniversity of Sydney, Australia

Pei-Shan Kao AndreaUniversity of Essex, United Kingdom

Loredana BoscaSpiru Haret University, Romania

Ilie PinteaSpiru Haret University, Romania

Flávio de São Pedro FilhoFederal University of Rondonia, Brazil

Kamani PereraRegional Centre For Strategic Studies, Sri Lanka

Ecaterina PatrascuSpiru Haret University, Bucharest

Fabricio Moraes de AlmeidaFederal University of Rondonia, Brazil

Catalina NeculaiUniversity of Coventry, UK

Anna Maria ConstantinoviciAL. I. Cuza University, Romania

Romona MihailaSpiru Haret University, Romania

Mahdi MoharrampourIslamic Azad University buinzahra Branch, Qazvin, Iran

Titus PopPhD, Partium Christian University, Oradea,Romania

J. K. VIJAYAKUMARKing Abdullah University of Science & Technology,Saudi Arabia.

George - Calin SERITANPostdoctoral ResearcherFaculty of Philosophy and Socio-Political Sciences Al. I. Cuza University, Iasi

REZA KAFIPOURShiraz University of Medical Sciences Shiraz, Iran

Rajendra ShendgeDirector, B.C.U.D. Solapur University, Solapur

Nimita KhannaDirector, Isara Institute of Management, New Delhi

Salve R. N.Department of Sociology, Shivaji University, Kolhapur

P. MalyadriGovernment Degree College, Tandur, A.P.

S. D. SindkhedkarPSGVP Mandal's Arts, Science and Commerce College, Shahada [ M.S. ]

Anurag MisraDBS College, Kanpur

C. D. BalajiPanimalar Engineering College, Chennai

Bhavana vivek patolePhD, Elphinstone college mumbai-32

Awadhesh Kumar ShirotriyaSecretary, Play India Play (Trust),Meerut (U.P.)

Govind P. ShindeBharati Vidyapeeth School of Distance Education Center, Navi Mumbai

Sonal SinghVikram University, Ujjain

Jayashree Patil-DakeMBA Department of Badruka College Commerce and Arts Post Graduate Centre (BCCAPGC),Kachiguda, Hyderabad

Maj. Dr. S. Bakhtiar ChoudharyDirector,Hyderabad AP India.

AR. SARAVANAKUMARALAGAPPA UNIVERSITY, KARAIKUDI,TN

V.MAHALAKSHMIDean, Panimalar Engineering College

S.KANNANPh.D , Annamalai University

Kanwar Dinesh SinghDept.English, Government Postgraduate College , solan More.........

Advisory Board

Welcome to Review Of ResearchISSN No.2249-894X

Review Of Research Journal is a multidisciplinary research journal, published monthly in English, Hindi & Marathi Language. All research papers submitted to the journal will be double - blind peer reviewed referred by members of the editorial Board readers will include investigator in universities, research institutes government and industry with research interest in the general subjects.

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Review Of Research ISSN:-2249-894XImpact Factor : 3.1402(UIF)

Vol. 4 | Issue. 5 | Feb. 2015Available online at www.ror.isrj.org

SIGNIFICANCE OF BUSINESS RESEARCH REPORTS – A CASE STUDY ON GLOBAL AND

INDIAN PAINT INDUSTRY

Abstract:-Business research reports document the progress and provide analyst with a means of comparing periods of time, project details, and history of growth. While Analyst may rely on a superior memory or the amount of profits companies make each year to gauge their progress, the data Analyst collects in reports can serve a number of important purposes. It can help formulate budget and marketing plans for the upcoming year. It also can allow to realize which products or services are the most successful, and which markets company may have overlooked.

Keywords:Global and Indian Paint Industry ,Business research reports , marketing plans .

INTRODUCTION

Research reports are also an integral part of actively managing any company. Management uses the reports to track progress toward its various goals, control expenditures and increase revenue. Business reports help to predict trends, and this is an advantage toward increasing profits. Managers who review the reports on a daily or frequent basis can quickly make adjustments for abnormalities. Some business reports illustrate a specific problem within the company. These types of reports present a problem along with solutions to help correct the problems.

Business reports are required in disciplines such as accounting, finance, management, marketing and commerce. Often the type of assignment set is a practical learning task requiring to apply the theories one has been studying to real world or realistic situations.

Management uses reports when planning future budgets. They study various reports to learn current and historical trends within the company and its industry. They can see how the company compares to other businesses of similar size within the industry as a whole, or within a specified geographic area. Business reports help managers to predict upcoming trends, so they can adjust inventory, advertising and personnel to meet an expected busy or slow period.

A business report can be the best way a company has to communicate vital financial and background information to others. Many larger companies that write business reports throughout the year to employees and for board members hire a staff that do nothing but keep abreast of company changes and write current business reports. Depending on the situation, failing to have a well-written business report to present when you need one can make it difficult to acquire funding, cause company turmoil or may make it difficult to achieve company goals.

PURPOSE OF BUSINESS REPORT

Company reports provide information on the health of your company to shareholders, stakeholders, the media and your community.

A business report provides information on the company’s fiscal year. Graphs or charts can be included to break down complicated information and make it more understandable. Business reports include a trends, income statement, financial summary and cash flow statement. Financial notes also may be added to explain accounting methods the company uses to report and record its transactions. Additional information found in notes may detail how a company allocates pension plan contributions, how equipment has depreciated over time or more detailed

1 2Kunal S Badade and Jaideep Jadhav ,“SIGNIFICANCE OF BUSINESS RESEARCH REPORTS – A CASE STUDY ON GLOBAL

AND INDIAN PAINT INDUSTRY” Review of Research | Volume 4 | Issue 5 | Feb 2015 | Online & Print

1 2Kunal S Badade and Jaideep Jadhav

1Vice-Principal and Head, Department of College of Commerce, Latur .2Head, MIT School of Telecom Management, Kothrud, Pune,

1

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information about stock option compensation. The financial information provided in business reports helps readers determine what the company owns and owes, how the company is funding operations and growth, and how good the company is at making money for investors.

HIGHLIGHT ACHIEVEMENTS

Business reports provide information on the company’s mission and history and summarize the company’s achievements in the past year. While financial achievements are included, other achievements also are noted, such as research advances, market share gains or honors awarded to the company or its employees. The achievement section also may include information on such things as sales increases or new machinery that increases profitability and productivity. The chief purpose of the achievements section is to make shareholders and stakeholders feel good about their investments or participation in your company.

PROMOTE THE COMPANY

In addition to providing financial information, a business report serves as a marketing tool for your company. Use of a specific theme, such as a historical milestone or a focus on improving lives through technology, is often used in business reports. Inclusion of positive stories from employees and customers or key moments in your company’s history interspersed throughout the report can increase readership of the report and appeal to new investors and customers. Sophisticated design and layout techniques are an important consideration when using a business report as a marketing tool. Inc. magazine notes that some companies use a variety of formats, including electronic business reports, to make their reports more appealing to readers.

OTHER INFORMATION

Business reports introduce board of directors and key personnel to shareholders, stakeholders and the general public and often contain photographs of these people. A letter to the company’s shareholders appears at the beginning of the business report. It highlights information of particular interest, such as a brief overview of profits, successful marketing strategies, campaigns, changing business conditions and information about the company’s plans for the upcoming year. The letter is written by the highest member of the company’s administration, such as the chairman of the board or chief executive officer, and helps set a positive tone for the business report.

BENEFITS OF BUSINESS RESEARCH

It provides information about the Industry, Competition, Economy, and Technology & Business Environment.

CHARACTERISTICS OF BUSINESS RESEARCH

vBusiness research is almost always applied research. This means that it is problem oriented with the objective of obtaining information to help solve a specific business problem or make a decision.vBusiness research tends to have a time limit. It makes little sense to gather information about a decision that was made three weeks ago or to get information next week that we need today. Information is highly perishable. It gets old and useless very quickly. Like fish, if you don’t consume it when fresh, it loses a lot of its flavor and starts to smell bad!vBusiness research is done in an environment in which conditions change rapidly. The answers to research questions asked today may very well differ from the answers to the same questions obtained yesterday. In those areas where the manager needs to “stay in tune” with the changing landscape, the same research questions might need to be asked repeatedly. Successful organizations develop a culture where constant research is an integral part of their operation.vBusiness is a for-profit enterprise, so research must have some cost limits applied. Research can be expensive and time consuming (although many economical approaches can be used).

Principle Areas of Business Research

lMarket Sector Research lIndustry ResearchlCompetitor AnalysislCorporate ResearchlBusiness Topic ResearchlEconomic And Financial Research

SIGNIFICANCE OF BUSINESS RESEARCH REPORTS – A CASE STUDY ON GLOBAL AND INDIAN PAINT INDUSTRY

2Review Of Research | Volume 4 | Issue 5 | Feb 2015

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Market Sector Research

Successful businesses needed thorough understanding of the markets in which they operates. Such an understanding allows them to sell effectively by targeting customers. Furthermore, it allows companies to compete with others suppliers. It also allows companies identify new opportunities.

Market intelligence should asses the supply side that competes with you and also the demand side. General trends can be ascertained using public market information both from free government statistics and data to pay for market records from commercial providers. Internal records such as contacts sale records can be important resource.

INDUSTRY RESEARCH

The main objectives of industry research are –

lUnderstanding the industry structure, competition and level of profitability.lThe assessment of an industry’s attractiveness. lThe identification of key success factors. l The forecast of profitability.lThe deduce strategies to improve profitability.

For these, Analyst need to consider the competitive forces that exits in the industry and indentify and analyzing the driving forces the relative position of the each company in the sector is assesses as are the likely factors which determines success or failure.

COMPETITOR ANALYSIS

It covers wide range of issues including image and positioning objectives, commitments current and past strategies, size, growth, strength, opportunity, threat etc.

It is worthwhile considering who competitors are. There are number of tools and techniques which can be used

vBCG MatrixvCritical success factor comparisonvSWOT Analysis vPESTAL Analysis

Corporate Analysis

This is somewhat similar to competitor analysis in tools and model Analyst use. The emphasis however is not on the competition, but on the other organizations. Such organization might include partners, investors, suppliers or customers.

Economic and Financial Research

This research subset analyses of following areas

sCurrent, Historic and Forecast Economic DatasThe strength and weaknesses in the Economy sActivities and Sectors which shrinking, growing and stagnating.

This research is useful if organization planning to launch new products or in new markets or geographic region.

OBJECTIVES

To Analyze the Global Paint Industry with special reference to the Indian markets

SCOPE OF THE STUDY

Researcher has analyzed Global Perspectives with more emphasis on Indian Market. In all company reports and industry reports, researcher has considered for last five years i.e. from 2008-09 to 2013-14. The

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SIGNIFICANCE OF BUSINESS RESEARCH REPORTS – A CASE STUDY ON GLOBAL AND INDIAN PAINT INDUSTRY

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researcher has applied various tools like Ratio Analysis, Political Economic Social and Technological (PEST) Analysis, Environmental Analysis, Strengths Weakness Opportunities and Threats (SWOT) Analysis, etc.

ANALYSIS OF PAINT INDUSTRY

Global Markets

It is one of the fastest growing industries globally and has two primary functions protection and decoration. It is use to maintain and protect existing structures, including residential homes and apartments, public buildings, plants and factories equipments and industrial products as well. Paint industry is divided into three categories- Architecture, Industrial OEM and Special purpose coatings.

The market for paints and coatings was valued at $111.2 billion in 2012 and reach $116.9 billion in 2013. Total market valued is expected to reach $141 billion in 2018 after increasing at five-year compound annual growth rate of 3.8 %. The demand for paints and coatings are expected to begin in Asia Pacific region that will aid to boost industry significantly.

Geographically, Asia Pacific is the largest consumer of paints and coatings, which is followed by Europe, North America and Latin America. There is a major shift in the global paints and coatings production, which is moving away from the developed regions, such as Europe and the U.S., to the developing economies, such as Asia, comprising China and India.

Most companies now days are focusing on zero VOC (volatile organic compounds) and green paints that are particularly in high demand among the customers. It’s not only keep away customers from harmful chemicals but also encourage green environment.

Revenue of Global Paint Companies in FY 2013

In term of revenue, Akzonobel, PPG Industry and Sherwin-Williams holds 60% percent of global market. Which shows that how dominate they are in Global Paint Industry.

Major Global Player’s Financial Performance 2013

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Company (In

$bn) / Item

Total

Sales

Operating

Income

Net Income

(Loss)

Total

Assets

Total

Equity

No. of

Employee

Akzanobel 20.13 9.58 9.13 8.76 6.02 49560

PPG Industry 15.1 0.98 2.54 15.86 4.93 42600

Sherwin-Williams 10.19 4.95 2.63 6.92 1.87 37633

DuPont 5.76 4.28 3.51 51.49 8.59 60650

BASF 5.19 7.27 4.84 64.38 27.06 112206

SIGNIFICANCE OF BUSINESS RESEARCH REPORTS – A CASE STUDY ON GLOBAL AND INDIAN PAINT INDUSTRY

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Future Trends of Global Paint Industry

The estimate market revenue in 2018 will be $6969.2 mn and consumption volume predicted to be 1617.81 kilo tones .The compound annual growth rate of the market in the period of 2010- 2018 is 8.5%.

Indian Perspective

The paint industry in India has grown at a CAGR of 19.0% which makes one of the fastest growing industries. Indian paint industry is valued at US$ 5 Billion and is expected to double by 2018. The growth of the paint industry in India has been consistent with the GDP growth rate over the years. There is a shift in the market in terms of growing stress upon the usage of environment friendly paints. The companies have introduced various paints products which are eco friendly and less harmful to the environment in recent years

Premium products account for less than 25% of the organized decorative paints market and has grown at more than 15% annually in the last few years in India. The market has been witnessed inflow of a gamut of innovative products which serve to the changing decor styles and improving aesthetic tastes of growing urban population. The unorganized sector controls around 35% of the paint market, there are about 2,000 units having small and medium sized paint manufacturing plants in India.

The industry is expected to grow at 12-13% annually over the next five years from Rs 280 bn in FY13 to around Rs 500 bn by FY18. FY13 was a challenging year for the industry as a whole due to subdued demand across key sectors and rising inflation.

Decorative paints segment is expected to witness higher growth going forward, so as increased industrial paint demand, especially powder coatings and high performance coatings will also propel top line growth of paint majors in the medium term.

In terms of volume, the industry stood at 3.11 million tones, of which decorative segment accounted for nearly 77 per cent share. Paint industry expect the 70:30 trend of decorative and industrial segments to continue even in future, mainly because of the growing urbanization and increase in disposable income

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SIGNIFICANCE OF BUSINESS RESEARCH REPORTS – A CASE STUDY ON GLOBAL AND INDIAN PAINT INDUSTRY

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Key Players

•Asian Paints•Berger •Kansai Nerolac•Akzonobel•Shalimar

Indian Paint Industry Market share

Asian Paints dominating the market with approx 33% market share of Indian paint industry followed by Berger paint with 11%, Nerolac with 10.8%. The difference between Asian paints and other companies indicate that Asian paints performance have been magnificent over the years in Indian paint market and ruled out other companies.

Trends for the Future

The market for paints in India is expected to grow at 1.5 times to 2 times GDP in the next five years. With GDP growth expected to be between 5-6% levels, the top three players are likely to clock above industry growth rates in the future, considering they have a strong brand and good reach.

Decorative paints segment is expected to witness higher growth going forward. The fiscal incentives given by the government to the housing sector have immensely benefited the housing sector. This will benefit key players in the long term.

Although the demand for industrial paints is lukewarm it is expected to increase going forward. This is on account of increasing investments in infrastructure. Domestic and global auto majors have long term plans for the Indian market, which augur well for automotive paint manufacturers like Kansai Nerolac and Asian-PPG. Increased industrial paint demand, especially powder coatings and high performance coatings will also propel topline growth of paint majors in the medium term. If the new capacities do not get utilized well, companies may face margin pressures in the near term.

REFERENCES:

1.Agrawal Ashok, Mutual Funds Emerging Trends and Prospects, Chandralok Prakashan, Kanpur, 20022.Avadhani V A, Investment Management, Himalaya Publishing House, 20073.Banerjee Arindam, Indian Capital markets, 2006 - Trends and Reforms, ICFAI Books, ICFAI University Press, 20064.Banerjee Arindam, IPOs - Concepts and Experiences, ICFAI Books, ICFAI University Press, 20075.Banerjee Arindam, Capital Markets in the BRIC Economies, ICFAI Books, ICFAI University Press, 20076.Bernstein Jake, Profit in the Futures Markets, Vision Books Investment, New Delhi, 20027.Bhalla V K, Investment Management, S.Chand, 20088.Chaudhari Tamal Datta, Financial Sector Reforms - An Indian Perspectives, ICFAI Books, ICFAI University Press, 2006

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SIGNIFICANCE OF BUSINESS RESEARCH REPORTS – A CASE STUDY ON GLOBAL AND INDIAN PAINT INDUSTRY

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9.D Satish, P Krishna Kishore, Behavioural Finance - An Introduction, ICFAI Books, ICFAI University Press, 200610.Dave Manoj V, Chauhan Lalitkumar R, Mutual Funds in India ( Modern Scenario ) Paradise Publishers, Jaipur (India), 201111.Katuri Nageswara Rao, Financial System- Stability Asian Perspectives, ICFAI Books, ICFAI University Press, 200712.Komaromi Gyorgy, Anatomy of Stock Market Bubbles, ICFAI Books, ICFAI University Press, 200613.Krefetz Gerald, The Basics of Stocks, Vision Books Investment, New Delhi, 200414.Kristof Kathy, Investing for Beginners Vision Books Investment, New Delhi, 200515.Lahiri Keka, Pension Fund Management - An Introduction, ICFAI Books, ICFAI University Press, 200616.Maturi Richard J, 100 world-famous Stock Market Techniques, Vision Books Investment, New Delhi, 200617.Mishra Chandra Shekar, Panda Chakradhara, Proceedings of the International Conference, 2004 on Business & Finance Vol. VI - International Finance and Asset Pricing, ICFAI Books, ICFAI University Press, 200518.V Panduranga Rao, M S Sahoo, KVSS Narayana Rao, Prabhas K Rath, Proceedings of the International Conference, 2005 on Emerging Securities Market - Challenges and Prospects Vol. III I - Regulation and Development of Securities Market - Researcher's Perspectives, ICFAI Books, ICFAI University Press, 2006.

WEBSITES CONSULTED

1.www. online.wsj.com/2.www.google.com/finance3.www.unwto.org4.www.euromonitor.com/5.www.investors.reuters.com/6.www.ibisworld.com7.www.search.ebscohost.com8.www.economist.com9.www.nber.org10.www.jpmorgan.com

7Review Of Research | Volume 4 | Issue 5 | Feb 2015

Kunal S BadadeVice-Principal and Head, Department of College of Commerce, Latur .

SIGNIFICANCE OF BUSINESS RESEARCH REPORTS – A CASE STUDY ON GLOBAL AND INDIAN PAINT INDUSTRY

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