In anticipation of the significant uptick in demand for the 2022 summer season, air conditioner manufacturer Blue Star launched a range of 50 new models of ACs for the upcoming season. 

“As an industry we look forward to the market growing at 20 per cent in comparison to 2019.” siad B Thiagarajan Managing Director for Blue Star Ltd. According to him, Blue Star, which enjoys 13.25 per cent market share as of the third quarter of the 2022 fiscal, will grow to a market share of 14 per cent by the end of FY23. These market gains will come despite the price hike that the company has taken in the aftermath of the Ukraine crisis.

Price hikes

In March, Blue Star took on a price hike of around 2-3 per cent, and future hikes could be considered in July again. A total 15 per cent hike in prices has been undertaken between January 2021 and 2022,  however, Thiagarajan says that they have also re-engineered their ACs in order to ensure their products remain affordable for the mass market. Since, 60 per cent Blue Star’s consumer base resides in tier 2-3 markets. 

Blue Star also has ambitions to further strengthen their presence in North India, Central India and East India markets, with a target to add 1,000 stores to bolster penetration. ‘

The company would commission its new manufacturing facility in Sri City, Andhra Pradesh in the latter half of 2022 (between October and December). While the total investment into the facility is of around ₹550 crore,₹153 crore of this investment will be eligible for the production linked incentive scheme, announced by the Centre. Of this, ₹73 crore is expected to be reimbursed back to the company. During the first year of manufacturing, the plant is expected to produce 12 lakh units. 

The range of ACs offered by Blue Star comprises 3-star, 4-star, and 5-star inverter split air conditioners that start from ₹30,990. 

Despite the rise in input costs, the company has also managed to offer these products at attractive price points by cost-saving measures, it said.

“Blue Star has supplemented its product and pricing strategies with robust distribution and service mechanisms whereby the product range including its after- sales service is available in all Tier 2, 3, 4 and 5 cities and towns as well as Tier 1 cities, so as to reach the mass premium markets effectively,” the press release said.

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