Chemicals and Paints

India’s chemicals industry has been a global outperformer in demand growth with its rising domestic demand (CAGR 9.5% FY21-FY40) in chemical end-use sectors such as agriculture, consumer and retail, infrastructure, auto and electronics, and healthcare. Government initiatives under the Petroleum, Chemicals and Petrochemicals Investment Regions (PCPIR) policy and a shift in the global supply chain brought on by the China+1 strategy will fuel significant revenue growth in the sector.

The key drivers in the chemical industry market are:

Growing disposable incomes and increasing urbanization fuelling growth in end-user segments, such as paints, textiles, adhesives, personal and home care products

Investments in infrastructure driving demand for construction chemicals, adhesives, sealants, coatings, and other specialty chemicals

Shift towards healthier and eco-friendly products, drive innovation and product diversification in end user segment

Growing populations, changing dietary patterns, and the need to increase food production drive the demand for Agro-chemicals

At Qwixpert, we understand the challenges posed by this evolving landscape and possess extensive experience in providing effective solutions. We help a variety of chemical companies such as those in specialty chemicals, fertilizers, agro-chemicals, pigments, paints and coatings to realize a sustainable business model with improved production planning techniques, inventory management, supply chain network and focused marketing.

Allow us to outline the key trends impacting the chemical industry:

  • Growing export market with India emerging as an attractive investment destination to global corporations: During FY 2023, India achieved a milestone in the chemical industry with chemical exports reaching $30 billion with a Y-O-Y Growth of 14% in terms of volume (FY 2015-2023). This upward trajectory is attributed to a combination of strong improvement in global trade as well as government initiatives that have positioned India as an appealing investment destination for global corporations aiming to diversify and mitigate supply chain risks as part of their China+1 strategy. The robust performance of the sector is prompting chemical manufacturers to ramp up their production capacity to meet the growing demand for its products. Qwixpert has successfully partnered with companies to help them:
    • Identify lucrative business expansion opportunities in both the Indian and export markets by utilizing iterative shortlisting based on market size, growth outlook, operational and regulatory complexities, and potential for synergy.
    • Develop comprehensive capacity planning strategies by evaluating production capabilities, equipment utilization, and resource allocation, and suggest optimization and debottlenecking strategies to maximize output
  • Increasing consumer expectations and new products leading to SKU proliferation: With growing demand for biofriendly products and increasing consumer expectations for performance, durability, and safety, chemical companies need to develop specialized chemical solutions to meet these demands. For example, in the automotive industry, there is a proliferation of SKUs for specialty coatings, adhesives, and polymers to meet the specific requirements of different vehicle models and applications. The increasing number of SKUs seemingly cannibalises sales and increases production lead time due to batch production set up. We have assisted several businesses in precisely matching aggregate supply with demand, properly plan inventory, optimize production planning process, and maximize fulfilment over the sales and operation process (S&OP). We also specialize in analysing the right target group and recommend strategies for focussed marketing/promotion.
  • Supply chain disruptions leading to inflationary pressure: Persistent disruptions in the global supply chain network coupled with the on-going geopolitical conflict have caused widespread inflationary pressure across key commodities. E.g., Paint and pigment industries have suffered with availability constraints across commodities like monomers, Titanium Dioxides and speciality additives making it very important for them to secure future supply of material. We recently collaborated with a leading pigment manufacturing company, where we achieved significant savings potential by redesigning the inventory strategy and leveraging our forecasting capabilities to ensure timely procurement of raw material requirements, striking a balance between inventory carrying and stockout.
  • Cost-pressure and declining margins: The industry is facing a significant challenge of contracting gross margins due to steep rise in raw material costs; companies saw a ~5% decline in profitability attributed to 13% increase in cost of goods sold. Swift implementation of price increases to counteract the inflation in raw material cost, improving the product mix and identifying cost-effective material sourcing avenues can help businesses protect their margins. Qwixpert can help companies in minimising the impact of increasing costs and contain losses by identifying the right product mix through big data and analytics, reducing wastages in raw material, establishing long-term contracts or vertical integrations and implementing warehouse cost optimization measures.

The favourable growth projections make this an ideal time to grow the business but for long term value generation, cost-reduction and efficiency improvement measures are important. Qwixpert has experience in doing just that. Let us help you get healthy bottom lines while helping you realise your growth ambitions.

What can we do?

Our Solutions for Chemical and Paint Industry

Feasibility for internationalization

With, India expected to account for more than 20 percent of incremental global consumption of chemicals over the next two decades, it is the right time for chemical companies to explore international opportunities. Qwixpert can help companies make well informed decisions in identifying the right export market based on financial lucrativeness and operational constraints. We can support in conducting market research, developing market entry strategies, ensuring regulatory compliance, analysing competition, understanding cultural nuances, and mitigating risks.

Capacity Expansion Strategy

With almost all chemical industries in India focusing on investment in enhancing manufacturing capability, technology, and capacity, we can help you understand the size of market opportunity and work backwards to devise focused capacity addition programmes in your manufacturing. By analysing data and using modelling techniques, we can assist you in determining the optimal level of capacity expansion required to meet future demand while considering factors such as cost, lead time, and resource availability.

Redefining Organization structure

To keep pace with the evolving business landscape, it is important to develop an effective organizational structure that aligns with the organization’s strategic objectives. We can help chemical companies manage organizational change and transformation initiatives. We provide change management strategies, stakeholder engagement plans, and training programs to facilitate smooth transitions, drive employee adoption, and ensure successful implementation of new initiatives.


As the chemical industry faces increasing SKUs, demanding customers, and production complexities, it becomes imperative to have an efficient Sales and Operations Planning (S&OP) process in place. We can help design and implement an effective S&OP process tailored to the specific needs of the company, ensuring that the Supply Chain team and the Sales & Marketing team come together as one team to dynamically optimise available resources and service the demand to achieve high Order Fill Rates.

Product Portfolio Optimization

With companies investing heavily on ATL and BTL spend, launching 2-3 new brands per year and expanding their sales region; customers have more choices making strong brand recall a key success factor. We help determine the right brand communication strategies based on your desired brand perception. Our experts work closely with you to develop a marketing mix that aligns with your brand values and resonates with your target audience. By incorporating green goals in your messaging, we can help develop a strategy to stand out in the market.


Our in-house forecasting tool can help you predict future demand for raw materials and finished goods accurately ensuring a balance between inventory carrying and customer satisfaction.

Market Analytics

We will help convert your data to insights by leveraging our industry experience and our analytical skills. We can develop trackers and dashboards to ensure that leading macro & micro economic trends are detected, and you can plan for growth/disruptions well in advance.

Procurement Cost Reduction

Chemical manufacturing processes often involve complex and time-consuming production cycles. Our inventory management strategies ensure the availability of critical raw materials like rock phosphates and acid for Agrochemicals and other intermediate products at each stage of the production process. We also customize stocking strategies for fast-moving and slow-moving inventory for improved delivery to customer.

Warehouse Design

Due to competitive nature of the industry, it is important that warehouse enables efficient order processing and fulfilment along with accurate tracking and control of inventory. Qwixpert specializes in developing or improving the warehouse infrastructure and layout to optimize space utilization, material flow, and operational efficiency. We help design or redesign the warehouse layout, keeping in mind factors like storage requirements, material handling equipment, safety regulations, and workflow optimization.

Production Planning

As the value chain throughout the chemical industry becomes more competitive, digitisation of the supply chain to drive sustainable manufacturing is becoming critical. We help with implementing system-based production planning that aims to reduce lead time by streamlining processes, minimizing bottlenecks, and ensuring that resources are evenly & optimally utilized. Our dashboards will provide top management with complete view of factory productivity, production team with resource utilization and marketing team with supply date and help in faster and better decision making at all stages.

Network Design

The network design will also consist of recommendation of mode of transportation – road, rail and sea. Our in-house network optimisation tool will factor in logistics cost and the handling cost (detention and demurrage charges) and we will identify the most cost-efficient mode of transportation for inbound and outbound movement.

Our in-house products can help get to solutions faster

Our Technology

Our insights

In the fiscal year 2022, the Chemical Industry in India experienced a remarkable surge in growth, showcasing an impressive industry median of 42%. This substantial growth in the industry was accompanied by a notable improvement in the Return on Capital Employed (ROCE), which grew by 10% YoY, leading to an industry median of 18%. These positive trends highlight the Chemical Industry’s robust performance and its capacity to deliver enhanced returns on invested capital, reaffirming its position as a thriving and profitable sector.

Demand Generation

Despite the conservative nature of the chemical industry, marketing and promotional expenses grew by 27% in FY22, but accounting for just 1% of the total revenue generated.


Driven by sales growth and a significant increase in raw material costs, procurement expenses in the industry has surged by 51%, representing a substantial 58% contribution to the revenue generated. Additionally, payable days have gone stricter, experiencing a decline of 13% to reach 65 days.


Manufacturing expenses has grown by a massive 48% primarily driven by power and fuel expenses which contributes 86% of manufacturing cost. Concurrently, the industry has witnessed a significant improvement in capacity utilization, showcasing an impressive 30% growth in fixed asset turnover.

Order Fulfilment

In the backdrop of rising fuel prices and increased sales in FY22, logistics costs (contributing 3% of revenue) witnessed a substantial surge of 69%.


Employee Benefit expenses grew at a rate of 19% in FY22 accounting 5% of the total revenue.

Analysis: Growth VS RoCE

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