By Grasim Industries
The Competition Commission of India has ordered an investigation against India’s largest paint manufacturer Asian Paints for alleged abuse of dominant position in response to complaint filed by Aditya Birla Group’s Grasim Industries. “The Commission directs the Director General (‘DG’) to cause an investigation to be made into the matter and submit an investigation report within a period of 90 days of the receipt of the present order. At this prima facie stage, the Commission, in light of the material available on record, finds no reason to hear the OP before passing the present order,” said the regulator.The order clarified that observations made were not a final view on the case merits and directed the DG to conduct the probe without being swayed in any manner whatsoever by the observations made herein.Grasim has alleged that Asian Paints was abusing its dominant market position by offering discounts and incentives such as foreign travel to dealers in exchange for exclusivity. Asian Paints also increased sales targets for dealers who dealt with Birla products, Birla’s company alleged. The firm also accused Asian Paints of “coercing” landlords and transporters to refrain from engaging with Birla’s company.The CCI’s initial review shows Asian Paints has been “imposing unfair conditions upon them (dealers), which is found to be in the nature of exploitative conduct,” the watchdog said. Live EventsAccording to the order, Asian Paints restraining suppliers of essential raw materials from providing goods and services to the competitors like Grasim, as well as by coercing landlords, C&F agents and transporters to refrain from engaging with competitors like Grasim, Asian Paints seems to be prima facie creating barriers to new entrants in the market as well as partially foreclosing competition in the market, it said.Thus, the conduct of Asian Paints seems to be prima facie causing an appreciable adverse effect on competition in India, the regulator added.In India’s Rs 80,000 crore to 90,000 crore paint market, Asian Paints remains country’s largest paint manufacturer and holds 53% of the country’s installed paint production capacity. It has a vast distribution network of over 74,000 dealers across 1.6 lakh touchpoints. However, the giant has lost some of its dominance after Birla Opus launched in February 2024 and grew rapidly to garner a near 7% market share by March this year, Elara Capital data shows.(You can now subscribe to our Economic Times WhatsApp channel)
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(You can now subscribe to our Economic Times WhatsApp channel)Read More News onasian paintsgrasim industriesCCI investigation Asian PaintsAsian Paints abuse of dominant positionasian paints grasimAditya Birla Groupasian paintsmarket for decorative paints(Catch all the Business News, Breaking News, Budget 2025 Events and Latest News Updates on The Economic Times.) Subscribe to The Economic Times Prime and read the ET ePaper online….moreless