BAKU, Azerbaijan, April 10. The Qemtex
international company plans to enter the TOP 10 powder coating
manufacturers, said CEO of the company Alexandr Glukhov in an
exclusive interview with Trend together with Chairman of the
Board of Directors Jandos Temirgali.
– As we know, your company began operations in
Kazakhstan and became the country’s first powder coating
manufacturer. The company grew over time, and Qemtex Chemical
Holding was formed last year. Could you tell us about the company’s
development and growth?
– Alexandr Glukhov: Our company in Kazakhstan
was founded in 2003, and last year it celebrated its 20th
anniversary. Initially, it was created as a trading and
distribution company to sell powder coatings produced by foreign
companies in Kazakhstan’s domestic market.
We were the first in Kazakhstan to start importing and selling
these products, as the powder coating industry did not previously
exist in the country. Over time, we not only expanded our product
range by adding products from neighboring countries but also pushed
the development of local production facilities in the design of
polymer-painting workshops, the supply of painting equipment, and
the training of enterprise teams to work with this type of
product.
From 2003 to 2015, the company developed and expanded,
representing powder coating brands from Turkey and CIS countries in
the Kazakhstan market. With the creation of a single economic
space, the situation changed: in 2015, Kazakhstan’s borders opened
up for goods from the EAEU member countries. Russian powder coating
manufacturers began entering the market directly, bypassing
distributor networks. This not only negatively affected product
margins but also led to a decrease in product quality in the local
market. The only way forward was to create our own products to meet
the needs of the domestic market.
Thus, in 2015, the Asiacolor brand was created — the first and
still the only Kazakh brand of powder coatings. Initially,
production was established in China; despite extensive experience
in selling powder coatings, our team had neither the knowledge nor
sufficient resources to organize the process of manufacturing these
products.
We approached existing manufacturers in China with a clear
understanding of the exact products we needed. At the same time, we
fully controlled the quality, parameters, and assortment of goods,
which became highly sought after in Kazakhstan. Compared to other
brands’ products that came from outside the local market, the
quality of Asiacolor powder coatings was higher. Moreover, we
thoroughly knew the demands of the local market and placed orders
for products that met our customers’ needs.
We continued to produce products in China for three years. While
the team was working on supplying the Kazakh market with Asiacolor
products, I studied the technology of powder coating production.
Since I have a bachelor’s in economics and business and am not a
university-trained chemist, I had to dive into the issue from
scratch. Also, no such production facilities had ever existed in
Kazakhstan, and there was simply nowhere to draw information from.
It was necessary to establish cooperation with enterprises in
China, Turkey, and the UAE, where such production facilities were
operating and technologies were well-established.
By 2018, it became clear that our team’s accumulated knowledge
and experience were sufficient to launch our own production. We
relied solely on our in-house team; our first factory, the Almaty
Powder Coatings Plant, was built by the efforts of our Kazakh
specialists alone. Financially, we relied on our own funds while
also leveraging government support tools, which allowed us to
attract investments and launch the first phase of the project.
Ironically, the launch of production coincided with COVID-19
restrictions: the plant opened in December 2019, and by February of
the next year, a lockdown happened. Despite the fact that
enterprises and businesses around the world were frozen, our plant
not only survived that difficult period but even closed the year
with a profit, and the next year we more than doubled our
sales.
To this day, the Almaty Powder Coatings Plant remains the only
innovative powder coating production enterprise in the country,
driving the industry in Kazakhstan. After all, as production
continues to develop and mature, we forge ahead in gaining
experience, developing technologies, and making a significant
scientific and technical contribution to the industry. Entering the
international arena became a logical continuation of the
enterprise’s development. In 2023, we started construction of the
Qemtex plant in the UAE.
– How was the decision made to move from the local to
the global market? And why was it decided to locate the new
production facility in the UAE?
– Alexandr Glukhov: We had accumulated
significant potential: scientific, technical, and financial, and we
realized we were capable of meeting the needs of customers outside
of the domestic market. However, being localized in Kazakhstan, we
did not have the opportunity to enter the international market,
primarily because the country is landlocked, which is a major
logistical barrier. Therefore, the decision was made to build a
second plant abroad.
The United Arab Emirates became that country — the largest
global logistics hub and an ideal place to find highly qualified
specialists in various industries from different countries. Since
we planned to produce products not only for the local market but
also for export to other countries, the UAE turned out to be a
logical place for us to start working in the international
space.
– What products do your enterprises currently produce,
and in what volumes?
– Alexandr Glukhov: Our production capacity in
Kazakhstan is 1,500 tons per year. We meet the needs of local
manufacturers, so the majority of our products consist of
industrial coatings, mainly for the construction and electrical
engineering industries. Companies that produce metal products for
the local market, such as radiators and heating devices, are
significant consumers of our products.
The enterprise in the UAE will produce a much wider range of
products. This is because we plan to sell not only in the local
market but also work with customers from other countries, and the
needs for powder coatings vary in each region. In this regard, the
new plant in the UAE will house a modern laboratory and R&D
center.
Also, in the United Arab Emirates and several other countries in
the Middle East region, there is currently a surge in demand for
coatings due to the construction boom and the development of
production facilities. Consumers need architectural and facade
coatings and coatings for aluminum profiles, and we plan to meet
this demand. In addition, we are also interested in more niche
areas, such as coatings for household appliances and the automotive
industry. In Kazakhstan, such products are not manufactured, while
here, in the Middle East market, these industries exist, and the
demand for quality coatings for them is high.
– What will the product volume be at the new UAE Qemtex
plant? And what markets is it focused on?
– Jandos Temirgali: The project in the United
Arab Emirates is divided into two stages. The first stage, which is
already in its final phase, involves the production of 4,500 tons
of products per year. In the second stage, which we plan to launch
by the end of this year, we plan to expand production to 10,000
tons per year. The decision to split the launch of production into
two stages was made for a smoother market entry. We plan to start
with a relatively small volume with the aim of understanding the
specifics of the market, making the necessary adjustments, and
implementing them in the second stage to minimize risks.
Overall, the total volume of products produced by the enterprise
will depend on the implementation of our global strategy. We have
the potential to increase production at the UAE plant to 20,000
tons per year.
Although the enterprise is located in the GCC region, we do not
plan to stay within this “framework.” We view the UAE project as a
global export-oriented enterprise, aimed at opening representative
offices worldwide. We will produce products here and establish
connections with consumers based in a wide variety of regions with
different preferences and standards, whether in Europe, North
America, or Asia.
– Which markets are of particular interest to the
holding company and are important supply points? Are there any
Central Asian countries among them, particularly Kazakhstan and
Azerbaijan, and how much of a priority are these
markets?
– Alexandr Glukhov: At this stage, the markets
of particular interest to us are, of course, the markets where we
are localized. In Kazakhstan, we have shaped the powder coatings
market and remain the strongest player in it.
We are also very interested in working with Azerbaijan.
Kazakhstan and Azerbaijan currently have excellent relations and
strong trade ties. Experience shows that our countries are growing
closer, so the Azerbaijani market is very appealing to us. We will
definitely consider it, and now we have already entered that market
through our project in Kazakhstan.
For the Qemtex plant in the UAE, the GCC market where we are
starting operations is attractive, but our plans are much broader.
In terms of development, we are focused on the US market, as this
region is a hub for industry growth and we see tremendous potential
there.
Despite the fact that it is a very complex market with entirely
different rules and standards, we are not intimidated. We plan to
establish a research center in the United States that will study
and develop products specifically for this market. We are also
interested in Europe. In the future, we plan to set up a research
center in Italy and localize production there. We go where our
product is most in demand and profitable.
– How do you plan to cope with competition in the GCC
market? After all, unlike the Kazakhstan market, competition in the
powder coatings industry is high here.
– Jandos Temirgali: First and foremost, we are
not solely focused on the domestic market. Qemtex is open to
working with the entire world, and all the conditions for this are
available here. For example, large enterprises with plants in
different countries around the world are usually aimed at working
with local consumers.
We, on the other hand, are taking the opposite approach: we do
not have the task of placing the entire order within the region.
However, we have a strong scientific base and a multinational team,
which includes experts in the powder coatings field from
Kazakhstan, Italy, Turkey, India, and Saudi Arabia with up to 30
years of experience in the industry. This enables us to produce a
product that is adapted to the requirements of specific regions
around the world, regardless of where our production facilities are
located.
Fulfilling orders from other countries and having the
opportunity to learn how to work in these regions is a great
incentive for us. Therefore, we plan to produce about 30% of our
products at the Qemtex plant for the GCC market, while the majority
will be for customers from other regions.
But if we talk about competition with local manufacturers in
general, I don’t think anyone in this market will face
difficulties. Rather, this market currently requires much more
powder coatings than are being produced. There is a noticeable
trend of growing demand for powder coatings, not only in the Middle
East region but also worldwide.
In the GCC region, the UAE and Saudi Arabia have become drivers
of market growth. Demand for products is growing in the USA,
Europe, the Pacific region, and Latin America. This is due to
various reasons: both the increase in construction volume and
individual industries where high-quality coatings are required, as
well as a growing interest in powder coatings as an environmentally
friendly, functional, and more practical solution for manufacturers
than traditional liquid coatings.
I am also confident that if an enterprise produces a
high-quality product at appropriate market pricing, then there
won’t be problems with sales, even in competitive conditions.
– The company allocates substantial resources to the
research and development of new technologies. Could you tell us
about this area?
– Jandos Temirgali: As part of our project in
the UAE, we have formed a team of experts who will be engaged in
research, and I can say that our laboratory, which we will be
launching in the UAE in the near future, will be among the top
three leading laboratories for this type of product in the region.
In the future, we plan to open two more modern research centers in
the USA and Italy to develop new products and improve existing
ones, which will make Qemtex products increasingly accessible to
customers while maintaining their quality and adapting them to
specific markets and industries.
One could say that by investing significant resources in
research and development, we want to produce products that no one
else does. But in all seriousness, the powder coatings industry is
not only growing but also actively developing. It requires the
implementation of new technologies to adapt coatings to specific
customer needs.
For example, a manufacturer needs to produce a certain quantity
of products within existing production volumes and specific
technical conditions. A standard powder coating cannot meet this
requirement; it needs to be adapted or modified for the consumer.
Another example is when a manufacturer plans to produce products
that cannot be polymerized under standard curing parameters. A
special solution is needed to enable this.
There are countless examples like these, and we encounter
similar requests regularly: to produce coatings for products with
complex chemical preparation, for special climatic conditions, for
thinner decorative surfaces, for reducing energy costs in
production, and so on. Fulfilling such requests from consumers is
only possible if the company has a strong scientific foundation and
an innovative research center. That’s why we have and will continue
to invest substantial resources in research and development and
innovations in the industry.
– Today, companies have started to pay attention to
environmental protection in production and recycling. What measures
is Qemtex taking in this direction?
– Jandos Temirgali: Qemtex prioritizes
environmental friendliness and sustainable development. Our new
plant in the UAE is being built in compliance not only with local
environmental legislation but also with the strictest international
environmental standards.
We have zero emissions, and our production is 100% recyclable.
The only waste we generate is cardboard boxes and polyethylene, but
we send even that for recycling in return for new cardboard and
polyethylene packaging. We are proud of our 100 percent
eco-friendly, zero-waste production.
– In conclusion, tell us about the holding’s plans for
2024 and beyond. Are there plans to build new factories and expand
geographically? What investments will be directed toward
implementing these projects?
– Jandos Temirgali: In the third quarter of
2024, we plan to launch the enterprise in the UAE. At the end of
2024, we will start the second phase, which should be completed by
mid-2025. By that time, we plan to open representative offices in
the USA and Europe and increase the production capacity of the
enterprise in Kazakhstan to 3,000 tons per year.
In 2025, we will begin implementing projects in the USA and
Mexico. We are currently actively negotiating with local
authorities and selecting locations for these projects. The total
capacity of the two enterprises in North America will exceed 40,000
tons per year. Our largest R&D center will also be located in
the USA, and we plan to complete the construction of both
facilities in 2027.
Between 2027 and 2028, we plan to open a facility in Europe with
a research and development center in Italy. Overall, in the next
five years, we intend to increase our global presence to four to
five enterprises with locations in North America, Europe, and
Asia.
The total investment for these projects will exceed $100
million, and in five years, the total annual capacity of the
facilities will surpass 70,000 tons per year.
Our strategic plan is to become one of the top 10 global
companies in the production of powder coatings within the next
seven to eight years. We are confident that these plans are
achievable, as we have assembled a team capable of tackling fresh
challenges.