Heatwave in India: After two years of subdued sales, demand for summer products have peaked in 2024 - bringing cheer to the makers of air conditioners, refrigerators and coolers. As temperatures across the country surge to unbearable levels, causing heatwaves in many states, consumers are flocking to purchase home appliances that bring respite from scorching heat.
Take the room air conditioner (AC) market, for instance. While AC sales was growing steadily over the past three years, above normal temperatures in this summer season have bumped up their demand. While between 2021 and 2023, AC sales had grown by 15 per cent a year, this time the growth in sales volumes are already up by 25 per cent over last year.
According to B. Thiagarajan, Managing Director, Blue Star, with summer heat rising early in the south and west India - by March - AC sales has been growing fast since early summer. Additionally, companies including Blue Star has started to manufacture AC components under the production linked incentive (PLI) scheme, which has further helped them come up with ACs at competitive prices. “As a result, the steady price rise that the industry has been witnessing over the last several years, have cooled off - helping consumers,” he says.
“AC sales in 2024 are on a different trajectory. It is growing phenomenally. The way summer has panned this year, we expect the market to grow by over 30 per cent in 2024,” says Kamal Nandi, Business Head & Executive Vice President, Godrej Appliances, adding that Godrej is registering 50 per cent year-on-year growth.
The impact of a harsh summer is also visible in the refrigerator market. While for the past two-three years the mass market categories in essential appliances like refrigerators were subdued, since the beginning of summer in March 2024 demand for mass segment is also going up. Last year, refrigerator market remained flat as mass segment - primarily direct cool categories (single door refrigerators) registered de-growth by 6-7 per cent in unit sales. In 2022, mass segment was flat but premium grew by 20-22 per cent, resulting in an overall growth of 7-8 per cent, which was lower than 10 per cent overall growth in 2021. “Now both are growing at equal pace. This is one change that we now witness in three years,” says Nandi. The refrigerators market in India is about Rs 25,000-26,000 crore or 13 million units a year.
According to Avneet Singh Marwah, chief executive officer of smart TV and home appliances maker Super Plastronics, AC and cooler sales have skyrocketed since the beginning of the current summer season. “We are relatively new in this businesses and thus we are registering over 100 per cent growth,” he says.