Shalimar Paints’ MD and CEO says that the company’s is not looking at an another major capex cycle, as existing set-up is enough to support the revenue ambitions
While premium paints are gaining traction in urban India, rural consumers remain firmly value-focused, making premiumisation a largely city-centric story, says Kuldip Raina, Managing Director and Chief Executive Officer, Shalimar Paints. As the company sharpens its urban premium play through its Hero range and targets rural consumers with its Smart Bharat portfolio, Raina says rising disposable incomes are turning paint into a discretionary spending category, driving demand across tier 2, 3 and rural markets.
In an interview with BW Businessworld, Raina said the company has reduced its losses by 60 to 65 per cent and also turned Ebitda positive in the fourth quarter of FY26, through a combination of cost controls, operational efficiencies and portfolio optimisation. He added that the paint maker is targeting a revenue scale of Rs 1,200 to Rs 1,300 crore over the next two years without any significant fresh capital expenditure, with existing capacities sufficient to support the planned growth trajectory.
Road To Growth With Existing Capacity
On future investments, Raina said Shalimar Paints does not foresee a major capex cycle in the near term, having already completed the investments required to support its growth plans. “We are good to go for Rs 1,200 to Rs 1,300 crore kind of a top line in the next two years’ time,” he said, adding that only spending on automation and operational improvements will continue.
Addressing the company’s growth priorities, Raina described FY26 as a year of deliberate correction rather than aggressive expansion. The company exited products that did not make commercial sense and focused on demonstrating profitable growth. “We wanted to exhibit our ability to become positive and we delivered in the last quarter,” he said.
He also pointed to the intense pricing disruption witnessed across the paints industry over the past two years, calling it one of the most challenging periods the sector has faced in decades. Despite the difficult operating environment, Raina noted that Shalimar has grown 67 per cent over the last four years and believes demand could rebound as consumer sentiment improves and macroeconomic uncertainties ease.
On pricing, Raina indicated that most of the required price hikes have already been taken. Shalimar has passed on around 11 per cent of the 13-14 per cent cost increase it experienced, with the balance expected to be implemented shortly. While the delay may weigh on margins in the short term, he expects the impact to normalise within the first half of FY27.
The MD emphasised that the focus will remain firmly on profitable growth, emulsions and consumer-centric innovation. He added that Shalimar has undertaken extensive cost rationalisation and product re-engineering efforts.
Market Playbook And Demand Trend
Raina said the Indian paint market remains significantly underpenetrated, with per-capita consumption at roughly one-fifth of global levels. While demand is expanding across the country, he maintained that premiumisation remains largely an urban phenomenon, with affordability continuing to dictate purchase decisions in rural India.
“Premium products would not sell out in rural markets. It is too early for these markets to adopt premium products,” he said, adding that rising disposable incomes are nevertheless encouraging consumers across tier 2, 3 and rural markets to spend more on home improvement. To address this segment, Shalimar Paints introduced its Smart Bharat range, designed around local preferences and price sensitivities.
“We also started a distributor format, which gave us a penetration of at least 2,000 to 3,000 dealers in the first year of launch itself,” he added. For urban consumers, however, the strategy is markedly different. Raina said the company’s Hero portfolio, which now includes eight to nine emulsion variants, has been built around premium features and performance attributes targeted at younger, aspirational buyers. “The consumer is getting the best of the product at an affordable price,” he said.
On demand trends, Raina noted that both decorative and industrial paints are witnessing healthy momentum. While government spending on infrastructure, roads, metros and water projects is boosting industrial coatings demand, decorative paints continue to gain importance within the company’s portfolio.
“Last year also, our share of decorative increased by 2 per cent, which is good for the company because the decorative side is always more profitable as far as against industrial. But going forward, we are also introducing some different products, some value-added products into the industrial side also, which are going to be high-margin products,” he pointed out. Raina said that the company is also exploring water-based, nano-technology-led offerings and potential partnerships with multinational firms to strengthen its presence in the segment.
Evolving For The Modern Consumer
Reflecting on the company’s efforts to appeal to younger consumers, Raina said the priority over the past year was two-fold: making Shalimar Paints more relevant to today’s homebuyers while simultaneously restoring profitability. “Unless and until you evolve with the times, you lose the market,” he said, noting that consumer behaviour has changed significantly as access to information online and AI-driven discovery tools reduce reliance on retailers and painters for purchase decisions.
According to him, the company has invested heavily in building salience among younger consumers who increasingly influence painting and renovation choices. The strategy appears to be yielding results, with Shalimar reducing losses by 60 to 65 per cent and turning Ebitda positive in Q4FY26, he said. “That is what we had set for ourselves at the beginning of the year,” Raina noted.
On the painter ecosystem, Raina described painters as a critical influence point in the paints category, given their role in educating consumers on product selection, application techniques and emerging technologies. As a result, the company has intensified training programmes focused on new products, low-VOC solutions, water-based technologies and best painting practices.
Raina said Shalimar’s painter network has expanded by 30 to 40 per cent over the past year, with the company increasingly positioning painters as knowledge partners who can help consumers make informed decisions rather than simply execute paint jobs.
Sustainability Becoming Essential
Raina believes sustainability in paints has moved beyond being a premium, urban-led trend and has become a basic consumer requirement. With modern homes becoming increasingly enclosed and air-conditioned, he said that low-VOC and safer formulations are now essential from a health perspective. “This has become the hygiene. It is no longer something which is only true of high-end products,” he said.
Reflecting this shift, Shalimar has focused heavily on water-based technologies and low-VOC formulations across its portfolio. Raina said all 30 to 40 products launched by the company over the past two to three years have been designed around sustainability considerations. “We are focusing more on water-based technologies than solvent-based technologies,” he pointed out.
On the marketing front, he said the company’s communication strategy has evolved from traditional brand promotion to consumer education. Given the relatively low awareness levels in the paints category, Shalimar’s campaigns are increasingly focused on helping consumers understand product attributes, application requirements and purchase decisions.
Raina explained that social media now plays a critical role in reaching younger consumers, with the company using its online channels to share educational content and product knowledge. “Our intent is to give the right information to the consumer,” he said, adding that every campaign is designed to help buyers make more informed choices rather than simply push products.
