Economic growth, strict environmental regulations, growing investment in infrastructure, and increasing demand for green and environment-friendly coatings in the Asia-Pacific region are contributing to decorative paint and coatings market growth. Apac Decorative Paints & Coatings Market Is Forecast To Reach $36,513.5 Million By 2025, After Growing At A CAGR of 6.4% During 2020-2025.
Decorative paints and coatings are long-lasting, have low odour, and hygienic coats that are perfect for every unique residential and commercial building. The market of decorative paints & coatings is growing at a significant rate as its demand is on an upsurge from the building and construction industries owning to its various functional benefits, such as conduction, color retention properties, moisture vapor permeable, light absorption, insulation, anti-skid property, reflection, and more.
Government initiatives in India such as ‘Smart City Mission’ and ‘Housing for All’ are projected to drive the growth in the construction sector which, in turn, will benefit the APAC decorative paints and coatings market during the forecast period. According to the Department for International Trade (DIT), New Zealand is investing heavily to update and create a new critical infrastructure to cope with increased demand. An estimated $129 billion is expected to be spent on capital projects between 2019 and 2029. Thus, with the increasing government initiatives and investments, the building and construction industry is flourishing in the APAC region, which will propel the decorative paints & coatings market growth in the Asia Pacific.
The prevalence of COVID-19 pandemic situation has slightly weakened the demand for decorative paints & coatings in the year 2020 due to the lockdown. According to the International Monetary Fund (IMF), the Chinese economy contracted by 6.8 percent (YoY) in quarter 1 Contrary to the trend prevalent in the industry in general, the market of APAC decorative paints & coatings is witnessing a declining demand from the construction activities such as from the construction of facades, walls, and more. In addition, a decline in business for at least five months during 2020 coupled with lower demand from a few major markets has put pressure on the profitability of APAC decorative paints & Coatings manufacturers and vendors. However, due to the recapitulation of construction activities in various Asia Pacific countries, the demand for decorative paints & coatings for facades is estimated to rise in the upcoming years. In June 2020, the Australian Government has announced the “HomeBuilder initiative”, a time-limited grant program to help the residential construction market to bounce back from the Coronavirus crisis. The initiative provides eligible owners (including first home buyers) with a grant of $25,000 to build a new home or to renovate an existing home. The contract is to be signed in between 4 June 2020 and 31 December 2020.
China holds a major share of the APAC decorative paints & coatings market owing to the flourishing building and construction sector in the country. According to the International Trade Administration (ITA), the Chinese construction industry is forecasted to grow at an annual average of 5% in real terms between 2019 and 2023. In June 2019, China won the bid to host the 2023 Asian Cup football tournament due to which it plans to construct nine new football-only stadiums by the end of 2021. China has proposed Beijing, Changsha, Chengdu, Chongqing, Dalian, Guangzhou, Hangzhou, Shanghai, Suzhou, Tianjin, Wuhan, and Xi’an as host cities, and the country plans on delivering new stadia by the end of 2021. Minor renovation work is planned for the National Stadium in Beijing, along with the Tianjin Olympic Centre Stadium, Hangzhou Olympic Sports Expo Centre Main Stadium, Changsha’s Helong Sports Centre Stadium, and Guangzhou Tianhe Sports Centre Stadium. In addition, the ongoing State Council Green Building Action Plan, launched in 2014, mandates that public buildings such as schools, hospitals, museums, stadiums, and affordable housing, as well as any single building area over 20,000 square meters, such as airports, railway stations, hotels, restaurants, shopping malls, offices, and other large public buildings, must meet the green building standards of China’s 3-Star Rating System GBEL (The Green Building Evaluation Label). According to the Energy Foundation, by the end of 2018, cities and towns across the country had built a total of 2.5 billion square meters of green buildings, accounting for nearly 40 percent of new residential construction in urban areas. Thus, the increasing government investments and initiatives in China are propelling the building and construction sector, which will then boost the decorative paints & coatings market.
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APAC Decorative Paints & Coatings Market Growth Drivers:
Growth in Asia Pacific building and construction industry
Decorative coatings are easy to maintain and are highly resistant to vast environmental conditions. Therefore these are tremendously used in applications for residential and non-residential buildings, such as flooring, wall cladding, metal finishing applications, wall panels, and many more. They are predominantly used for renovating kitchen and bathroom surfaces. The building and construction industry is flourishing in countries such as India, and Singapore due to economic reforms, infrastructural development, and rising per capita income of the individuals. The population growth is resulting in the need for more residential and commercial sectors. In India, the government has initiated projects, such as ‘100 smart cities’ and ‘Housing for All by 2022,’ which are expected to drive the Indian residential construction market over the forecast period. According to the Australian trade and investment commission, the Singapore government spends at least S$2 billion on public infrastructure each month. Also, projected Singapore’s average construction demand for 2018 and 2019 was in between S$26 billion-S$35 billion. The building and construction activities are also increasing owing to the various government initiatives such as Foreign Direct Investments (FDI). Hence, with the increase in construction activities across the globe, the demand for decorative coatings will be foreseen to grow enormously. Thus, such government investments and initiatives in the construction industry act as a driver for the market.
Research and Development departments are continually improving existing product performance, optimizing manufacturing efficiencies, and developing the next generation of decorative paint and coating solutions with newer applications such as glass and ceramics. In August 2018, Axalta has launched Eleglas™, a vibrant portfolio of decorative coatings designed to protect and enhance the aesthetics of glass and ceramic surfaces. Eleglas coatings are available in a variety of colors, finishes, and specifications, and are designed to protect surfaces against shattering, chemicals, abrasions, scratches, and washing. In addition, its anti-shatter technology is designed to protect broken items from leaking or causing injury.
The Major Players in this Market Include
The major companies in the APAC decorative paints & coatings market include Nippon Paint Holdings Co., Ltd., Asian Paints, AkzoNobel N.V., PPG Industries, Inc., Kansai Paint Co Ltd., Jotun A/S, BASF SE, The Sherwin-Williams Company, Axalta Coating Systems, LLC, and Noroo Paint & Coatings Co., Ltd. The key focus of the companies has shifted towards product launch and acquisition. In September 2020, Nippon Paint Holdings Co., Ltd. developed “PROTECTON”, a new brand for anti-viral and anti-bacterial products that use cutting-edge paint technology. The Company will develop anti-viral and anti-bacterial products, which can be used for home and industrial applications, in stages. In March 2020, AkzoNobel N.V has launched the water-based paint “Hammerite Ultima” which is suitable for all types of metal and provide a supreme protective barrier. It can be applied directly onto metal as well as rust without applying primer.
In August 2020, Nippon Paint Holdings Co., Ltd agreed with Wuthelam to increase its stake in Asia JVs to 100% and acquire its Indonesia business. This agreement will bring a 60-year-long partnership to perfection and build a strong foundation for accelerated growth.
In December 2017, Asian Paints acquired Reno Chemicals Pharmaceuticals and Cosmetics Pvt. Ltd for Rs 159.52 crore ($24.7 million) in cash. Asian Paints purchased Reno to use its land and building to meet its growing infrastructure requirements.
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