The price of air-conditioners is poised to go up by about 15 per cent this summer over the last year due to an increase in input costs, changed energy efficiency norms and the big impact faced by manufacturers due to exchange rate fluctuation, according to Mr B. Thiagarajan, President, Air-conditioning and Refrigeration Products Group, Blue Star.

This increase has become inevitable as most manufacturers import compressors. The rupee versus dollar rate has gone up from about Rs 46 to Rs 52. Manufacturers are faced with an increase in input costs besides enhanced energy efficiency norms of the Bureau of Energy Efficiency, Mr Thiagarajan said.

Speaking after the launch of Blue Star's latest range of home ACs, Mr Thiagarajan said “last summer was disappointing for AC makers. But the next few summers would be exciting for all manufacturers as we believe this is just the beginning of a rapid growth phase. Most manufacturers, including several multinational companies, have invested anticipating growth.”

NEW RANGE

The new range of ACs expands Blue Star's home AC portfolio to 45 this year. The company has launched what it describes as a category changer, Multi-Inverter Split ACs, suitable for apartments and villas.

The company's services arm has emerged one of the fastest growing, generating Rs 500 crore. However, the contract business has taken a toll on its performance as several projects have been delayed by developers due to the slowdown.

Last fiscal, Blue Star augmented its capacity with an investment of Rs 40 crore in Himachal Pradesh and spent Rs 16 crore on marketing and Rs 20 crore on R&D. This year, it has planned a marketing spend of Rs 20 crore. It is considering an additional manufacturing base in the South next year.

vrishi@thehindu.co.in

Related Topics
comment COMMENT NOW