Scorching heat fans double-digit sales of ACs and fridges in India

Air-conditioner and refrigerator makers reported strong volume and value growth as prolonged heat and delayed monsoon boosted demand despite multiple price hikes

As temperatures soared across the country through most of the summer months, cooling appliance makers saw their sales shoot up with volume and value growth coming in double digits.

 

Air-conditioner (AC) and refrigerator firms have seen strong growth despite price hikes due to rupee depreciation, rising raw material costs, and BEE (Bureau of Energy Efficiency) rating change that took effect at the start of the year.

 

Since March, cooling appliance makers have implemented price hikes to the extent of 8-15 per cent.

 

Voltas saw strong double-digit growth especially in April-May, Mukundan Menon, managing director, Voltas Limited, told Business Standard. “Our inventory levels are good. Demand has been very strong across the country, barring Punjab, Rajasthan, and Delhi-NCR,” Menon said.

 

The company has taken two rounds of price hikes in March and April, and is implementing another round in June to pass on higher raw material costs. The March and April price hike were in the range of 10-15 per cent, depending on the product.

 

Voltas AC sales have crossed 1 million on strong consumer demand for FY27, the company had said in a release on Sunday.

 

Last year, AC and refrigerator sales lagged due to unseasonal rains witnessed in most parts of the country.

 

B Thiagarajan, managing director of Blue Star Ltd, said that the company’s volume growth stood at 25 per cent, while value growth was at 30 per cent. He, however, added that the full price increase due to higher raw material costs was not passed on to the consumer, which could dent margins.

 

“The consumer sentiment was strong, but it’s nothing to be excited about as last year was also a bad year due to weather conditions, and this year could be a painful year due to various issues, like the West Asia crisis, which could derail growth,” he said.

 

LG Electronics India Ltd has witnessed a strong April-June quarter as its AC segment was an outperformer. “India’s tropical climate, combined with an extended summer season and delayed monsoon onset, has sustained strong consumer demand well beyond the typical peak period. With AC penetration still at around 11 per cent in a country of India’s scale, the headroom for growth remains substantial,” said Sanjay Chitkara, director and cochief sales and marketing officer, LG Electronics, said.

 

He added that easing global tensions and moderating raw material costs are gradually restoring consumer confidence, a positive indicator for the broader industry.

 

“We expect this positive demand trajectory to carry through the coming quarters as well,” he added.

 

Vijay Sales also saw strong demand across the country this summer, barring North India. “Compared to June last year, we have seen volume growth of 10-15 per cent and value growth was higher at 20-25 per cent due to price increases,” said Nilesh Gupta, managing director at Vijay Sales. 

Business spurt 

• Despite price hikes, rising raw material costs, and BEE rating change, sales have gone up
• Voltas saw strong double-digit growth especially in April-May
• Blue Star’s volume grew 25%, while value growth rose 30%
• Vijay Sales’ volume rose 10-15% and value growth was up 20-25%