From apparel players to air-conditioner and beverage firms, consumer product companies are banking on the summer season for strong growth even as inflationary pressures remain unabated. After two washed-out consecutive summers, impacted due to pandemic induced-restrictions, companies say they are hoping to garner growth over 2019 levels this year.

With offices reopening and consumers beginning to stepping out, post the easing of third pandemic wave-induced restrictions, apparel makers expect to see good demand for their summer collections. Rajesh Jain, CEO and MD, Lacoste India said, “From February we have begun witnessing positive demand trends. We expect to see a 20-25 per cent increase over summer season in 2019. So in terms of topline growth we are optimistic for the summer season.” But Jain pointed out that the raw material and other costs have escalated significantly and will impact the bottomline for apparel makers. “So companies are absorbing some part of these higher costs but some part of it will definitely be passed on to the customers,” he added.

Consumer durables demand

For consumer durable companies too, this will be a critical summer season to push sales of cooling products such as air-conditioners. The players have had to bear the brunt of pandemic-induced restrictions during the peak summer seasons in 2020 and 2021. Post the third wave in January, companies have also have cranked up production for ACs

.B. Thiagarajan, MD, Blue Star said, “We expect to see good pent-up demand for ACs and targeting a 20 per cent growth over 2019 levels.”

Inflation, a key concern

But inflationary pressures remain a key concern amidst the ongoing Russia-Ukraine crisis. Kamal Nandi, Business Head and Executive Vice President, Godrej Appliances said, “In the past two consecutive summer consumers had to postpone their decisions due to the pandemic. So we definitely expect to see the desired growth momentum over last year. But amidst inflationary pressures, we will have to see whether growth surpasses 2019 levels ”

Beverage companies are banking on the uptick in demand in the out-of-home channel and HORECA (hotels, restaurants and catering) segments. According to an analyst note by Motilal Oswal, on earnings of PepsiCo’s bottler Varun Beverages, “In CY20 and CY21, the pandemic impacted the peak seasons of the beverage industry. Major growth is expected in the Q2CY22. We expect strong recovery to continue going forward led by out-of-home consumption with the opening up of offices and traveling activity and growing refrigeration in rural and semi-rural areas.”

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