Crown Paints will open a Sh400 million plant in Kisumu in January to cut costs and capture a larger share of the growing real estate market in the western region.
The company is seeking to increase its output as well as reduce cost of transporting paint from its Nairobi plant.
The Nairobi Securities Exchange-listed company will now supply all the counties in the area from the new plant that will be fully automated with a capacity of 1.3 million litres per month. Currently, Crown produces 2.3 million litres of paint per month.
“Forty per cent of our sales come from this region and this plant will enable us serve the area better,” said chief executive Rakesh Rao.
“We are also spending a lot to transport the paint from Nairobi. But 70 per cent of paint is water so we are spending a lot to transport water.”
The areas, especially Kisumu and Eldoret in Uasin Gishu, have seen huge growth in real estate development providing a good future market for the paints maker. Developers have been flocking to the lakeside town with several companies announcing plans for major projects.
Coromandele Investment Ltd, a Swedish developer, last year announced it was putting up 30 villas priced at S8.5 million and Sh48.5 million at Riat Hills, three kilometres from Kisumu International Airport.
Home Afrika, a listed real estate firm, also plans to build a gated community in the same area. The firm has bought a 72-acre piece of land which it’s still selling to buyers wishing to build holiday homes.
Government-owned National Housing Corporation, which will put up 3,000 housing units using the proceeds of a Sh5 billion bond, is also targeting Kisumu.
SOURCE: BUSINESS DAILY