A1One of the items that could have a significant impact on our earnings is the provision for potential credit loss. Since we started the Project segment in China 6 -7 years ago, we have been increasing our market share by providing a broad range of solutions with a focus on the top 30 and top 100 major real estate developers. At that time, extending the collection period of trade receivables from certain real estate developers was an effective way to beat competitors, although it involved certain risks. However, the Chinese government has implemented restrictive measures, putting real estate developers including quasi-private companies in a challenging situation.
In this environment, we have been diversifying the receivable collection risk since the 2H of FY2021 by increasing transactions with state-owned real estate developers and focusing on projects of distributors such as builders. As a result, the percentage of major real estate developers in the total transactions has been gradually decreasing. Based on our understanding of differences in the current market environment compared with past environment, we are aiming to expand operations by keeping a balance between earnings and risks.
When you look at the new housing market in China, sales of ready-to-occupy units with interior finishes are increasing, rather than skeleton units without interior finishes. As a result, some of the DIY demand is flowing into the Project segment. However, we have been focusing more on the DIY segment since FY2021 and we believe that there is still room for revenue growth due to our ability to pass on price increases and our strong brand power in the DIY business. As a result, DIY revenue growth has increased dramatically from the low single-digit YoY growth in 2019-2020 to 35% in FY2021.
The DIY business involves very limited risk because the collection period for trade receivables is short and receivable collections are basically completed by the end of the year. If our business is reliant on the Project segment, your concerns would be well founded. However, NIPSEA China's sales are mostly from the DIY business in China, which has remained on strong growth path, so we do not think the risk involved is high.
Regarding geopolitical risk, there has been considerable progress with decoupling in China. However, China is not self-sufficient in all raw materials, so the country may be vulnerable to some risks. In addition, if China were to become isolated from the rest of the global economy, it would disrupt the entire Chinese economy. If that happens, there is a risk that disposable income will decrease, which will cause paint demand to decline. Although there may be geopolitical risk involving China, we do not believe there are many major risk factors that could affect our businesses.
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Nippon Paint Holdings Co. Ltd. published this content on 25 August 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 August 2022 08:27:00 UTC.
Nippon Paint Holdings Co Ltd is a company mainly engaged in the manufacture and sale of coating materials and fine chemicals products. The Company is involved in the manufacture and sale of paint for automobile-, general- and industrial-uses, as well as fine chemicals. The Company operates in four business segments. The Japan segment conducts paint for automobile-, general- and industrial-uses, as well as fine chemicals business. The Asia segment conducts paint for automobile-, general- and industrial-uses, as well as fine chemicals business in China Singapore, Malaysia, Thailand, Korea, Southeast Asian countries, India. The Oceania segment conducts paint business, such as paint for general-, industrial-uses, and paints peripheral businesses. The Americas segment conducts paint for automobile business and contruction coating materials business.
NIPPON PAINT HOLDINGS CO., LTD. 
