CHENNAI: Leading paint maker Asian Paints has approached the Supreme Court of India, challenging the Competition Commission of India’s (CCI) decision to order a probe into allegations of market abuse. The move is expected to keep the company’s stock under near-term pressure, as investors may stay cautious until there is clarity from the court.
The company moved the top court after the Bombay High Court recently dismissed its plea seeking to quash the CCI investigation after a case filed by Grasim Industries’ paints division, Birla Opus.
Market analysts, who spoke to media, say that any delay or uncertainty around the CCI probe could lead to short-term volatility in the Asian Paint stock, although the broader impact on the company’s long-term prospects is likely to be limited.
Shares of rival paint makers such as Berger Paints, Kansai Nerolac and Indigo Paints could see mild speculative interest if investors anticipate a temporary competitive advantage for smaller players. Overall, the paints sector may trade with a slightly defensive tone next week, with sentiment driven largely by updates from the Supreme Court proceedings and regulatory signals from the CCI.
The dispute began earlier this year when Birla Opus, the paint business of the Aditya Birla Group, lodged a complaint accusing Asian Paints of abusing its dominant position in the decorative paints market. The CCI, after examining the complaint, directed its Director General to conduct a detailed investigation under Section 26(1) of the Competition Act.
Asian Paints has maintained that the CCI’s decision to launch the probe was procedurally flawed. The company has alleged that the competition regulator issued two different versions of its investigation order — one of which initially included allegations mentioning senior executives, later deleted or revised in the final order. The company argued that these inconsistencies raised questions about due process and caused reputational harm.
In its appeal before the Supreme Court, Asian Paints has sought to set aside both the CCI’s probe order and the Bombay High Court’s dismissal. The company said it is willing to cooperate with any fair inquiry but insisted that the investigation should be based on a transparent and consistent process.
The CCI probe stems from charges that Asian Paints used its dominant market position — estimated to be over half of India’s decorative paints segment — to restrict dealers from selling Birla Opus products by offering them selective discounts or incentives. Birla Opus, which entered the paint business in 2024, has been expanding rapidly and challenging established players in the market.
Legal experts, as quoted in reports, suggests that the Supreme Court’s decision will be closely watched, as it could set an important precedent for how competition investigations are handled in India. If the court upholds the CCI’s order, it could strengthen the regulator’s authority to act against large market players. On the other hand, if the court finds merit in Asian Paints’ claims, it may prompt tighter scrutiny of how the CCI drafts and revises its investigation orders.
For investors, the development adds an element of regulatory uncertainty around Asian Paints, though analysts believe the company’s business fundamentals remain strong. The outcome of the Supreme Court hearing will determine whether the CCI can proceed with its inquiry or will be required to revisit its earlier decision.
