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In another sign of consumption growth in the economy, credit ratings agency CRISIL has said India’s consumer durables sector is set to clock a robust revenue growth of 20 percent this fiscal, after a flattish run last fiscal.
According to CRISIL, this will be driven by electrical appliances makers (35 percent of sector revenue), which are expected to grow twice as fast as white goods makers (65 percent of sector revenue).
Operating profitability will be a wee lower due to costlier inputs and despite price hikes. Credit profiles will be stable on healthy accrual and low leverage, an analysis of 15 companies accounting for 45 percent of the sector’s revenue shows, CRISIL says.
Gautam Shahi, Director, CRISIL Ratings said, “The growth momentum is expected to accelerate this fiscal on positive consumer sentiment, uptrading and higher realisations. Consumer electricals will continue to outshine with 23-24 percent revenue growth expected this fiscal, compared with 14-15 percent for white goods, riding on factors such as shorter replacement cycle, necessity, and smaller ticket size.”
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