Dyes & Pigments
A knowledge driven industry with high capital requirements, Indian dyes and pigments industry accounts for 7% of the total production in the world. While this figure seems weak in comparison to other countries, India, in itself has a very well established industry in terms of technology and resourcefulness. Dyes – both organic and inorganic as well as pigments are a part of this USD 22 Billion market domestically. This industry works in tandem with textiles, plastics, paper, leather and printing inks sectors. For example, the textile industry growing at a rate of 18% in 2014 magnified demand for dyes last year and will continue to do so with the growing demand for apparels. With Atul industries being the top player of this industry in India, not only does it enforce itself as one of the highest exporters of the country but also reaffirms its brand through ardent corporate social responsibility measures. Among other participants, Clariant and Sudarshan Chem follow next with almost equal market shares between the two.
The most important driving factor of this industry is the depth of science it relies on. Strong technical expertise is a requisite to foster innovation and better product offer. India does produce some very high quality product lines which has not only beaten foreign products domestically but have also generated exports. Harnessing good research and development efforts is of prime importance in an industry coagulated by many SMEs. Technology, particularly in this industry, has high potential of being developed in India rather than being acquired from foreign sources.
With stringent performance norms to be adhered to and a growing demand for High Performance Pigments (HPP) worldwide, this industry is bound to grow with thrusts in textile, automobiles, plastics and various other industries. Although the recent past was dull for this industry due to downturn in consumption patterns as well as the economic slowdown, it has recovered quite well. A growing middle class population and rising per capita incomes feed the growth of this industry as consumers seek better lifestyles thus indirectly lifting demand of dyes and pigments. There is a plenty of redundancy in terms of following legal pursuits by companies which shifts focus off main operations. With a fragmented industry, achieving economies of scale has turned slightly difficult, which makes it imperative for companies to pursue large scale capital investments to increase capacity. Frugal spending on R&D may be wise but should serve results not only in product innovation but also in operational competitiveness.
Globally, an oversupply of dyestuff has hampered price stability but a brisk increase in demand for colorants, especially in the Asia-Pacific region should stimulate equilibrium status of prices for the companies. The demand for inorganic pigments (example TiO2 and iron oxides) is higher than those of organic ones (example pthalocyanines and HPP) with increased craving for superior quality raw materials. However, off late there is an increasing preference for environmentally responsible products. The growing economies of India and China have attracted foreign investments from HeuBach and True Chem to begin with, but have stilted growth in India at present since supply has exceeded demand. The R&D spends need to be risen and demand needs to be created especially in the international markets. Reliance on manufacturing has to come domestically and not through foreign sources since not only does that hamper cost performance but also deteriorates self-sufficiency. The Government can work as a fulcrum to the industry in two ways - PPP models should be encouraged and infrastructure facilities for SMEs should be strengthened by access to cheaper sources of finance, an example would be Technology Upgradation Funds (TUFs). In the B2B sector, joint ventures to pool resources for common operations can help businesses focus on core functions. With the introduction of GST, we can expect a dip in transaction costs in the future. But instead of focusing on depended benefits, companies must strengthen their cost sheets through better technology and research.
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What this report contains:
A detailed overview of the industry
Structure of the industry from both, domestic and international perspectives
Related industries that this industry has inter-dependencies with and their understanding
Detailed analysis of industry segments in terms of the value and depth of corresponding market
Analysis & insights about the elements and critical success factors of this industry using strategic models
A forecast on the state of this industry in 2020, predicting the growth and movement patterns for 2016 - 2020
Our professional analysis on the future of the industry based on strategic actions adopted by major industry participants
Quantitative estimates and forecasts of the growth prospects of the industry using revenue and financial forecasting models