Only all-weather ACs from Voltas stable from this summer

Voltas Ltd, a Tata Group company, has decided to bid adieu to normal air-conditioning (AC) machines as part of its strategy to focus on all-weather ACs, introduced last summer.

The company on Thursday unveiled 86 new stock-keeping units (SKUs), with 23 being window ACs. "All SKUs are all-weather ACs, and all our future products will be in the all-weather AC category," said Pradeep Bakshi, chief operating officer, Voltas unitary products business group (UPBG).

Last summer, Voltas launched about 70 SKUs, maintaining a good mix of all-weather ACs and the normal machines. All-weather ACs have helped the company regain its leadership position in the domestic market. According to Bakshi, Voltas has 18.5 per cent market share in the domestic AC market as on March 2013.

While ACs are mostly sold during summers, the aggressive marketing of all-weather ACs kept Voltas' sales running throughout the year. This summer, Voltas targets its revenue from ACs to increase by 20 per cent with sales of one million units.

"We have been growing at around 20 per cent in the last few years and we are confident to maintain the growth rate this fiscal as well," Bakshi said. The company's UPBG vertical posted a turnover of Rs 1,560 crore in 2011-12. It sold about 800,000 ACs last financial year.

Last year, the Tata Group unit had reportedly crossed its Korean rivals, LG Electronics and Samsung Electronics, in terms of sales.

Bakshi is hopeful that tier-II and III cities will become growth drivers, contributing about 55 per cent to the company's annual sales, as metro markets are getting saturated day by day.

The company gets about 85 per cent from retail and distribution sales, and the remaining 15 per cent comes from institutional sales. Though input costs have increased, the company would not consider any price rise this summer, Bakshi said.

At present, Voltas has around 6,000 distributors across the country. It aims to cross 7,500 of such touch points by the end of this financial year.

The company would spend about three per cent of its revenue on marketing during the summer.