The Paint Brand Wars: CCI probe and stiff competition push industry into warfare
As India’s competition watchdog investigates alleged unfair practices, paint majors like Nerolac, and Birla Opus battle it out for dealer dominance and consumer mindshare.
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The Indian paint industry- estimated to be around a ₹70,000 crore market long dominated by Asian Paints, is at an inflection point. The Competition Commission of India’s (CCI) fresh probe into alleged anti-competitive practices by the sector leader has reignited a long-standing debate: are India’s paint wars being fought more in the marketplace or in the dealer network?
While Asian Paints remains under investigation, the controversy has already cast a spotlight on the opaque but powerful dealership dynamics that shape the decorative paint business - a segment that contributes the bulk of revenue for most players.
The fallout could redefine how paint brands engage with distributors and retailers, and whether deep-rooted relationships can withstand growing scrutiny and new competition.
The CCI Cloud and the Dealer Dilemma
At the heart of the controversy are allegations that large paint companies, led by Asian Paints, have used their market dominance to restrict dealers from stocking rival brands - a claim the company has denied in the past.
The CCI’s probe, still in early stages, has revived uncomfortable questions about exclusivity clauses, incentive-led loyalty, and the fine line between competitive strategy and anti-competitive behavior.
“Dealers are the lifeblood of the paints business,” says Ankur Bisen, Senior VP, Retail & Consumer Products, Technopak Advisors. “What’s changed in the last few years is that the balance of power between brands and dealers is shifting. Earlier, consumers were emotionally drawn to paint brands - today, what matters more is availability, price, and dealer margins. The industry is moving from a ‘brand pull’ to a ‘brand push’ model.”
According to Bisen, Asian Paints’ strength lies in its deep-rooted dealer network - some relationships go back 40 or 50 years, which allows it to dominate shelf space and ensure near-instant replenishment.
“If a dealer orders Asian Paints, they get replenishment in two days. If a new player takes 10 days, that’s eight days of lost sales. That trust takes decades to build,” he notes.
But with new entrants like Birla Opus and JSW Paints ramping up capacity and distribution, dealers now have more options than ever before and brands are scrambling to defend their turf.
Nerolac’s Balancing Act: Fair Play, Fast Service, and Dealer Trust
For Kansai Nerolac Paints, India’s third-largest paint company, the CCI probe has brought both reflection and reaffirmation. The brand, which holds around a 10% market share in decorative paints and leads in industrial coatings, is taking a measured but firm stance on fair competition.
“Competition in paints isn’t new - what’s changed is the scale of marketing aggression,” says Pravin Chaudhari, Managing Director of Kansai Nerolac Paints.
“India’s paint penetration is only one-third of global averages, so there’s ample headroom for growth. Rivalry may create noise in the short term, but fundamentals and trust in the distribution ecosystem will decide who wins.”
Nerolac’s strategy hinges on service reliability and transparency- values Chaudhari says are ingrained in the company’s Japanese DNA. “Being a multinational, fairness and transparency are non-negotiable. Dealers today are multi-brand, mature, and profit-driven. If they don’t see value in a brand, they’ll switch- there’s no compulsion. Our job is to ensure they get competitive products, strong margins, and dependable service.”
The company directly serves over 35,000 dealer touchpoints through 124 depots, ensuring delivery within 4–8 hours - a service model that Chaudhari believes is critical to sustaining dealer confidence. “Some impact at the margin is inevitable when new players come in,” he admits. “But our direct-to-dealer model and long-standing relationships - many spanning two or three generations - give us resilience.”
Nerolac’s manufacturing backbone- eight fully backward-integrated plants across the country supports this agility. While its strongholds lie in the North, East, and West, the company is now focusing on deepening presence in the South, a region it admits remains relatively weaker.
The New Paint Politics: Cola Wars 2.0
With marketing aggression peaking, the paints industry’s competitive narrative is increasingly being compared to the cola wars of the 1990s. The entry of deep-pocketed conglomerates like the Aditya Birla Group (through Birla Opus) and JSW Paints has intensified the battle, especially in the decorative segment.
“Earlier, competition came from specialist brands like Dulux or Shalimar Paints,” says Bisen. “Now, it’s conglomerates treating paints as a vertical- with the capital and patience to invest long-term. They can match or even exceed existing dealer incentives.”
That’s precisely what Birla Opus is doing.
“Our foundation rests on transparency, quality, and long-term trust,” says Rakshit Hargave, CEO of Birla Opus Paints. “We aim to strengthen confidence across the value chain through fairness in dealer partnerships and industry-first initiatives like the Birla Opus Assurance program.”
The company, which has six manufacturing facilities, 145 depots, and a presence in 10,000 towns, is banking on accessibility and emotional connection to drive growth. “Our focus remains on simplifying the painting journey,” Hargave adds. “This festive season, we’re connecting with consumers through immersive retail experiences and integrated campaigns.”
Muted Festive Cheer, Rising Pressure
Despite the marketing blitz, the near-term outlook isn’t entirely bright. Analysts expect muted volume growth this quarter, with extended monsoons and an early Diwali shortening the pre-festive demand window.
“Consumer sentiments remain weak across both rural and urban markets,” notes Kruttika Prabhudesai, Research Analyst at Mirae Asset ShareKhan. “While repainting and government projects may provide some cushion, heightened competition and overcapacity will continue to weigh on margins.”
Prabhudesai adds that even though crude prices have moderated, margins remain under stress due to higher promotional spends and dealer incentives. “Brands are spending aggressively to protect market share - this is increasing negative operating leverage.”
For Nerolac, however, the festive season remains crucial. The company has rolled out its new campaign, “Ghar Ki Raunak Lautani Ho”, featuring brand ambassador Ranveer Singh- a creative collaboration with long-time partner FCB India, the agency behind its iconic jingles.
“Historically, TV dominated our media mix,” says Chaudhari. “Now, digital and influencer engagement have grown significantly, especially with painters, architects, and applicators. Our festive spends are higher this quarter than last year, in line with the earlier Diwali timing.”
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As the CCI probe unfolds, the broader paints industry faces a reckoning. Dealers, once seen merely as intermediaries, are now at the center of strategy and scrutiny alike. The ability to balance competitive aggression with ethical conduct will likely determine who thrives in the next phase of the paint wars.
“The challenge for all players- legacy and new - is consistency,” says Bisen. “Distribution is destiny in this market. You can’t win just with ads or discounts. You win when every dealer believes you’ll deliver - every single time.”
