Análisis de perspectivas de desarrollo y estado de mercado de la industria de recubrimiento de China en 2020

Industrial chain analysis of the paint industry

The upstream industry of the coatings industry includes chemical raw material manufacturing industries such as resins, solvents, pigments, and additives, while the upstream of chemical raw materials such as resins and solvents is the petrochemical industry. The downstream of the coatings industry is mainly composed of manufacturing companies in the construction, furniture, automotive, home appliances, and other sectors, as well as the residential decoration market.

The influence of upstream raw materials on the industry is mainly reflected in two aspects: first, the stability of production scale affects the stability of raw material supply in the paint industry; second, the price of raw materials affects the production cost of paints. The impact of the downstream product market on the paint industry is mainly reflected in the market scale and development trends of paints.

Paint production in China exceeds 24 million tons

In recent years, paint production in China and its operating rate have rebounded, showing high potential for market development. In terms of supply, from 2014 to 2019, the production of the coatings industry in China increased year by year, reaching a production of 24.388 million tons in 2019, a slight increase compared to 2018, with an annual growth of 2.60%; the compound annual growth rate is 9.27%.

Analysis of the competitive market pattern of the paint industry in China

There are many companies participating in market competition in the paint industry, and industrial competition is relatively intense. Under full market competition, the market share of the industry is gradually concentrating on recognized brand companies, showing a more evident tiered level.

First-tier companies: they cover the entire product line of the coatings industry and hold a certain leading position in the field of functional and special coatings, such as multinational coatings groups PPG, Sherwin-Williams, Nippon, Akzo Nobel, and others.

Second-tier companies: they have strong competitive advantages in some segments of the paint industry, such as Carpenter, Sankey, Aspect, China Resources Paint, Orient Rainbows, etc. Among them, Sankey has strong competitive advantages in wall paints and ranks among the top ten listed companies globally in terms of the global market value of coatings in 2020.

Third-tier companies: they profit by producing low-quality and low-priced products, being weak in terms of technical strength, production scale, and research and development, with weak competitiveness; a large number of small domestic paint production companies are in this third tier.

Analysis of the performance of local listed companies in the paint industry in China

In the first half of 2020, among local listed companies in China in the coatings industry, Dongfang Yuhong achieved the highest operating revenue, reaching 8.783 billion yuan, far ahead of other companies; followed by Keshun and Sankeshu, with operating revenues of 2.659 and 2.595 billion yuan respectively.

Among the top five local listed Chinese companies in terms of revenue in the first half of 2020, Keshun had the highest annual increase in operating revenue, reaching 34.70%; while China Electric Research recorded negative growth, achieving operating revenue of 1.086 billion yuan in the first half of the year, a decline of 21.76%.

In the first half of 2020, the net profit trend of listed companies in the coatings industry remained basically consistent with operating revenues, with the top three being Orient Rainbows, Keshun, and China Electric Research, with net profits of 1.097, 290, and 129 million yuan respectively. The net profit of ASTRONET in the first half of the year was 111 million yuan, and the net profit of Feikai Materials in the first half of the year was 110 million yuan, slightly higher than the 109 million yuan of Sankeyu, ranking fifth.

Analysis of the development prospects of the paint industry in China

The "Thirteenth Five-Year Plan" of the paint industry in China indicates that, benefiting from demand driven by industrial and civil sectors, the total economic volume of the industry will continue to grow steadily during the "Thirteenth Five-Year Plan" period, with an average annual growth rate of total production value of at least 6.5%. By 2023, the total production value of the paint industry is expected to grow to approximately 690 billion yuan; calculating production with an average annual growth rate of 5%, it is expected that by 2020 the total production of the paint industry will increase to approximately 27 million tons.

Looking ahead, considering that the growth rate of paint production in China in 2019 was only 2.60%, and that the operating rate of factories will be significantly affected under the continued influence of the novel coronavirus pneumonia epidemic in 2020, it is expected that the annual paint production will decrease to approximately 23 million tons in 2020. In the future, paint production in China will grow at a compound annual rate of 2.6%, and by 2025, the national paint production will approach 27 million tons.