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Room air-conditioner makers expect to record strong sales this summer, despite the impact of unseasonal rains on demand momentum in March. Most AC makers are targeting double-digit growth this year. Rating agency ICRA, too, has predicted that the industry would post double-digit volume growth in FY24, despite a high sales base in the previous fiscal.
B. Thiagarajan, MD, Blue Star Pvt Ltd said, ’‘There has been significant sales offtake for air-conditioners in quite a few markets. This includes the southern states, as well as the Western region. As temperatures rise, we expect to see a pick-up in demand in the next two-three weeks, even in the northern region. We expect to garner 20-25 per cent growth in this season.”
Also read: Indian consumers increasingly prefer connected air-conditioners with purification technology
Volumes in March were almost flat compared to last year due to the impact of unseasonal rains in certain parts of the country, industry players said. However, industry did see 5-7 per cent value growth.
Kamal Nandi, Business Head and Executive Vice-President – Godrej Appliances, said: ”February was warmer than last year. However, demand trends in March were impacted as temperatures were lower than expected, especially in the northern region. But we have begun witnessing a pick-up in demand again. So we remain bullish on achieving our targets for the summer season. Also, the RBI’s decision to keep the repo rate unchanged has brought some relief for consumers.” In February, Godrej Appliances had said it is targeting 2x growth in AC sales over last year.
Industry players pointed out that unlike last year, when AC demand hit a peak by the middle of the summer season, demand is expected to be spread out through the season this year.
Meanwhile, In its latest report, ICRA said it foresees a 15-20 per cent jump in room air-conditioner volumes in FY2024 despite a high sales base in FY23 (26-28 per cent). This growth will be supported by factors such as lower penetration, expectations of a harsh summer, increasing urbanisation, and improving consumer finance availability, it added.
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