As the country enters the festive season, the white goods industry has witnessed a surge in demand across products from urban and rural areas.
High end air conditioners, refrigerators, automatic washing machines, and microwaves across the premium segment are driving demand during the season, said Kamal Nandi, Business Head and Executive VP at Godrej Appliances.
Godrej Appliances, which is a part of the Godrej & Boyce Mfg Co Ltd, is expecting a 50 per cent increase in sales over the last year during the festive season.
“The premium segment has witnessed growth in metro, tier 1 and tier 2 cities. We expect 80 per cent growth in our premium segment and 10 to 15 per cent growth in our value segment. Technology that adds to the convenience and health of consumers are driving higher preferences. Onam has shown that the demand has been better than 2019 by about 5 to 6 per cent,” he told BusinessLine.
Further, the company is seeking to increase its market share in refrigerators to more than 10 per cent, washing machines to 14 to 15 per cent and a 2 per cent market share increase in air conditioners to 7 percent.
Cautious call
To increase sales during the festive season, companies are offering consumers exchange offers, extended warranty, higher purchase schemes and cash back offers. “Focus is to ensure consumers are less burdened to shell out large amounts of money,” said Nandi.
With the RBI likely to increase the interest rate, there would be impact on the white goods industry from consumers who purchase using EMI facilities. “As the interest rate goes up, there is pressure on consumers. A higher interest rate is not desirable but I do not see this happening in the premium product segments,” said Nandi.
There appears no significant impact of commodity inflation on the goods pricing and demand during the festive season, “We will make a cautious call after evaluation in the second half of November post the festive season,” said Nandi.
With the objective of boosting domestic manufacturing, the PLI scheme has aided in the increase in manufacturing in the air conditioners category. “We are seeing increased component manufacturing in the country. Compressors are still imported. But with that being manufactured in the country...the ratio that was around 75 per cent last year has come down to 60-65 per cent and is expected to come down to a level of 25 to 30 per cent,” added Nandi.