If crude oil prices remain high, paint prices in India may increase by 2 to 5 percent from April. This estimate has been expressed in a report by Systematix Research. According to the report, dealers are hopeful that if crude oil prices continue to rise, paint companies may decide to increase the prices of their products.
However, at present no paint company has made any official announcement of increasing the price. It is believed that companies can wait till March 2026 so that the direction of crude oil prices and its impact on costs can be better understood.
Prices may increase if costs increase
The report said that if crude oil remains at the current high level, then most dealers expect the price to increase by 25 percent in April. If crude oil prices rise further and remain high for a long time, paint prices may increase even more. However, given the tough competition in the sector, companies may be cautious in increasing prices. According to the report, even if the prices are increased, the increase will be limited initially and it will be implemented gradually.
There may be an increase in the first quarter of FY27
According to the report, the first round of price increase may be seen in the first quarter of FY27 and this increase may be at a lower level. If crude oil prices continue to rise further and remain high for a long time, there will be a possibility of further increases later. According to the report’s long-term analysis, if crude oil prices increase by about 10 percent on a quarterly basis, companies may see an average decline of about 130 basis points in their gross margins.
Demand remains strong in paint industry
According to the report, the demand in the paint industry currently remains stable. Dealers from different sectors say that the total demand is seeing value growth of mid-single digit i.e. about 46 percent. Also, in most areas, sales of low-cost segment paints, such as economy emulsion and distemper, are growing faster than premium and luxury paint products.