Al Gurg Leigh's Paints aims to achieve 50% growth by year-end

Al Gurg Leigh's Paints plans to increase its market share from 10 per cent to 12 per cent, said a senior official.

"We do not want to run after numbers. Our licensee arrangements are stringent and we have a year-long audit on our manufacturing processes, which keeps us pretty busy with quality. We also focus on high-end projects," said Sunil Gudur, Chief Manager at Al Gurg Leigh's Paints. "But we have achieved a value growth of 40 per cent over last year and around 30 per cent in terms of volume growth. We hope to close the year at 50-per cent mark. In terms of investments, we have looked at a large figure for the coming year."

The company has been seriously investing in infrastructure. "We have just ordered machines for increasing production capacity, which currently stands at one million litres per month. But we could double it by 50 per cent. The other major investment is into human resources since we need the additional capacity to reach areas that we were not able to reach so far."

Meanwhile, the company is getting into a synergy with the Bell Group, a leading paint contracting team in the UK. "The lead came to us through our licensees and Bell is into government projects. The firm wished to tap into the construction boom here and were eyeing its options," said Gudur.

"They are our biggest clients in the UK. It will start examining the UAE market but is in the process of number crunching the potential at the moment.

"There will be no equity participation but we will work in assisting each other and share inputs and projects. There is no intent to get into a formal agreement as of now."

Al Gurg Leig's Paints is also taking the 'go green' motto seriously and is the first paint company in the UAE to become a member of the US Green Building Council.

"We have different ways of doing this. A straightforward way of looking at it would be to look at how many products we can move out of the solvent or the oil-based band to the water-based band. We are technical licensees of Dulux and hence have that advantage. So conversion is one option," said Gudur.

"The second objective would be to try and promote environmental-friendly processes and systems at a subtle level in terms of emissions, effluents, recycling and so on.

"The third way is to procure from raw materials suppliers who also believe in this philosophy. The last is a clichéd but the best way, which is through energy efficiency," he said.

Currently about 50-60 per cent of the company's products are water based. "But our role is restricted because of consumer demand. But wherever possible, we would like to drive the green agenda through and it comes from the top," said Gudur. "We do it in other ways too, such as planting trees around our factory. We are a small outfit but we are committed to the agenda in our own way."

Meanwhile, the paint industry is dogged by different issues, according to him. "Lack of knowledge is one such issue because paint treat paint at a cosmetic level. The word paint is a misnomer. It is actually a coating and the first job of a coating is protection," said Gudur.

"If a structure is given a good coating, its life can be extended and it decelerates attacks from environment. Three major criteria that affect exteriors in this region are salinity, carbon dioxide emissions (from heavy vehicular pollution and other sources) and heat (strong UV rays).

Many people look at the cosmetic appeal but not the protective aspects considering that concrete and steel are the core assets of a building and both are susceptible for corrosion."

He also admits there is an issue in procuring materials. "This year has been rather volatile in terms of oil derivatives. And paints, to a large extent, is based on oil derivatives. Since we are not a big player, there are issues in terms of easy availability, be it in terms of price or easy availability," he said.

"But I guess people realise that doing business with us is beneficial in the long run. Though I must admit that there is room for improvement," he said.

He also adds there is no scope for hedging. "Even if we wanted to, traders refuse to hold offers beyond an hour. It does not work," said Gudur. "Though oil prices have fallen, it does not reflect elsewhere."

The company has a diversified portfolio and mainly targets the industrial segment and the decorative segment, he said. Research is also ongoing. "Dulux, Leigh and Oasis are the three brands (the latter being an in-house brand) that we represent in the UAE and the latter is an inhouse product.

"The Oasis range was developed by us for a couple of reasons. We did feel a constraint at not having an economy range and it caters to that market and we are also looking at it in terms of exports," said Gudur.

"There are some other products that we have developed such as thermal insulation coating, which saves on power in the long run. Our activity is constant in terms of product improvement."

He expects a slowdown in the industry due to the global economic scenario but adds that the announced projects in the UAE will continue regardless.

"While it might affect the industry, it might mean a scaling down. But the situation is not as bad as the rest of the world," said Gudur.

"We work on very high-end projects, which are sustainable and hence are not yet worried at this point in time. Hence the impact is not as large. Maybe recoveries might be longer but the money is safe."



COMPANY PROFILE

Al Gurg Leigh's Paints was established in Sharjah in 1988 to manufacture a wide range of industrial and decorative coatings.

The protective coatings for the industrial, marine and petrochemical industry including coatings for fire protection are manufactured under licence from Leigh's Paints, UK, while high quality decorative paints are manufactured under licence from ICI Paints, UK.

AGLP manufactures and distributes the full range of paints under the Leigh's, Dulux and Oasis Brands.

In addition, Al Gurg Leigh's Paints operates a regional technical laboratory equipped with the latest R&D and analysis equipment.

Al Gurg Leigh's Paints is a member of the Easa Saleh Al Gurg Group. The majority of Al Gurg Leigh's Paints are to comply with green standards. The company claims that 75 per cent of its Dulux range already complies with standards set for 2010.