The board of directors of Asian Paints has approved the setting up of a manufacturing facility for VAE (Vinyl Acetate Ethylene Emulsion) and VAM (Vinyl Acetate Monomer) in India for a proposed investment of approximately Rs. 2,100 crore over a period of three years, including the cost of the land to be acquired.  

This is subject to entering into definitive agreements including technology license agreement for manufacturing of VAE and VAM, and obtaining necessary regulatory and other approvals. The installed capacity of the said manufacturing facility would be 100,000 tons p.a. for VAM and 150,000 tons p.a. for VAE.

VAE is considered to be the emulsion of the future, and the key constituent for manufacturing environment friendly paints whereas VAE offers better paint properties and can significantly improve paint performance in customer facing attributes. VAE is a key raw material for the company and VAM is a key input for manufacturing VAE.

Manufacturing VAM and VAE in India would provide substantial sustainable cost efficiencies, substituting our dependence on imports and would be used for the company’s internal consumption. This would be a key backward integration project for the company.

The setting up of a facility for manufacture of VAM would be based on licensed technology tie up with Kellogg Brown & Root LLC (KBR), USA. KBR is a US $7.3 billion company based in the USA and has presence in 80+ countries.

“Vinyl Acetate Ethylene Emulsion is the next gen environment friendly emulsion, based on a unique Vinyl Acetate Monomer technology, which gives a robust competitive edge to Asian Paints in the coatings business. This pioneering technology comes to Asian Paints with a strong sustainable cost advantage and helps us to offer next level innovation for our paint customers. Asian Paints will be one of the first paint companies to get into backward integration with the setting up of this VAM and VAE manufacturing facility and we feel that this would be a true game changer in the Indian market,” said Amit Syngle, MD & CEO, Asian Paints Limited.