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The rupee’s fall seems to be taking a toll on consumer durable firms. Many companies are firming up plans to hike product prices due to dependence on imports.
LG India on Monday said that it would hike prices by 3-5 per cent from June 18 across its home appliances such as refrigerators, washing machines, microwaves, vacuum cleaners, air and water purifiers and dish-washers.
Y.V. Verma, Director-Home Appliances, LG Electronics India, said, “Due to continuous rupee depreciation, it has become imperative for us to consider a price hike in India. Though we have been absorbing the increase in cost, it will become difficult to avoid this change in market prices…The impact of the price hike would be seen across all LG home appliances by 3 to 5 per cent from June 18. We hope our partners and patrons will co-operate with us in this situation.” However, the company is yet to take a decision on price hikes on product categories such as air-conditioners.
Mulling a hike
Other consumer durables firms are also in the process of passing on the increased cost to the consumer. Panasonic India Managing Director Manish Sharma said at present there was a rolling inventory for about 30 days. “However, after this window period, the prices are likely to increase by 3 per cent if the rupee does not recover,” he added.
A Samsung India spokesperson said the company had not yet taken any decision on price increase and was in wait-and-watch mode.
Meanwhile, Haier Appliances India Marketing Head Shanta Roy Sanjeev said the company planned to increase prices of its products by 5 per cent, effective end of this month or July 1.
A senior executive from a consumer durables firm said the fall in the rupee was massive, making price hikes inevitable. “While some might hold on to price increase till the current stocks last, others might look at increases by end of this month. It is just a matter of deciding the quantum and timing of the price hikes,” the executive added.
The air-conditioner category, which relies highly on imports, is particularly under pressure because of rupee depreciation.
Daikin India Managing Director Kanwal Jeet Jawa said, “Every company is under tremendous pressure due to the currency fluctuation. We will take a decision on the price hikes soon.”
He said air-conditioner makers were also facing challenges because of the early onset of the monsoon and late start to the summer this year.
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