Appliances industry expects up to 35% growth in sales during this festive season
Appliances and consumer durable makers are looking for up to 35 per cent growth in sales during this festive season on increasing demand for premium products and price hikes. Some of the companies, however, are “cautiously optimistic” about the sales of their entry-level mass products in the country’s hinterlands.
Companies such as Panasonic, LG, Sony, Samsung, Haier, Godrej Appliances, Voltas, Thomson and BSH Home Appliances expect this festive sale, which started with the onset of Onam in the south, to be better than the last year and even cross the pre-Covid sales volume.
The festive season, which starts from Onam and covers Durga Puja and ends with Diwali, contributes around one-third of the overall annual sales value across categories of the industry, which is estimated to be around Rs 75,000 crore.
Makers are finalising schemes such as extended warranties, easy EMIs and investing in promotional activities to attract customers, but are worried also over sales of entry-level mass products as consumers from smaller towns are still holding their purses on discretionary purchases.
The industry is concerned about any possible impact on sales due to monsoon rain deficit in some parts of the country and the average price hike of 7-8 per cent, which it has taken this fiscal.
“The festive target setting for the country will depend on how the monsoons fare overall and the consumer sentiment overall. We are cautiously optimistic as far as the mass segment is concerned but the premium segment is expected to continue doing very well in festive as well and will form the focus across categories,” said Godrej Appliances business head and executive vice president Kamal Nandi.
Panasonic Life Solutions India chairman Manish Sharma, who expects double-digit growth this festive season helped by its smart ACs, large screen TVs and the home appliances category, said consumers today have become conscious of their choices and value-proposition and premium appliances are taking precedence in their purchase decisions.
When asked about the monsoon rain deficit and sales in smaller towns, Sharma said:”We believe this might have an interim impact on sales. However, we are hoping to see this change post-Navratra as Tier III markets and beyond look forward to the festive offers as they aspire to purchase new home appliances.”
Comparing with the last year’s festive season sales, he said: “I believe, value growth will surpass volume growth this season. We expect to record a 10 per cent overall growth when compared to last year.”
Consumer Electronics and Appliances Manufacturers Association (CEAMA) president Eric Braganza said he expects an uptick in consumer demand and sees an upward trend in sales this festival season.
“Moreover, since everything is, fortunately, getting back to normal, this is expected to have a positive shift in consumers purchase. It all depends on the state of the economy as well. At this point, we can be cautiously optimistic,” he said.
Sony India managing director Sunil Nayyar said his company is already witnessing a festive season high with Onam and Ganesh Chaturthi sales performing beyond expectations.
“We are confident that this favourable growth momentum will be sustained throughout the festive season with our technologically advanced products, exciting consumer promotion offers and easy-on-pocket finance schemes,” he said.
Haier Appliances India president Satish N S said: “The industry would have an overall growth of 30-35 per cent in value this festive season and around 12 to 14 per cent by value.”
However, he also added that the sales of the entry-level products have been disturbed but the mid- and high-end products would have no impact. The entry-level customers are mostly first-time buyers of low-offering products such as 32-inch LED TV and semi-automatic washing machines, mostly from small towns.
LG India will launch a new range of products based on Indian insights during the festive season aiming to further strengthen its market position across product categories. When asked LG India VP- Home Appliances & Air Conditioners – Deepak Bansal said: “We are confident to cross pre-pandemic numbers.”
However, he also acknowledged inflationary pressures and said the appreciation of the US dollar is a concern.
“We are closely monitoring the situation. It was not wrong to say that growth will be value lead,” Bansal added.
Samsung India senior vice president, Consumer Electronics Business, Mohandeep Singh said the company has seen a strong start to the festive season during Onam and Ganesh Chaturthi, where it has witnessed huge demand for 55-inch and above large screen TVs, 300 litre-plus refrigerators and over 8 kg washing machines.
“We are confident this rising demand will further intensify during Durga Puja and Diwali, especially for our premium products, not only from the metro cities but even from Tier II and Tier III markets,” he said.
Cooling products maker and Tata group firm Voltas said it anticipates festive demand will be at par with the pre-pandemic level and demand will be driven by replacement, home upgradation and the need for products with advanced features, said its MD & CEO Pradeep Bakshi.
BSH Home Appliances (India and SAARC) MD and CEO Neeraj Bahl said the company is looking at a double-digit growth this festive season and devised consumer-centric offers.
“We have planned our local production and import supplies well in advance so we’re optimistic about meeting the high demand this festive,” he said.
Source: The Economic Times – Industry
