Cola, Ice-cream & AC Sales Sizzle on Heat Wave AC sales up over 50% last fortnight; early onset of summer likely to result in record sales for these product segments, say experts
Writankar Mukherjee & Ratna Bhushan
Kolkata | New Delhi: Heat waves in several parts of the country may have reached dangerous levels, prompting the weather department to issue a warning, but they have brought some relief to marketers of airconditioners, refrigerators, beverages and ice-creams who were reeling under poor demand since Diwali.
Sales of air-conditioners have jumped more than 50% year -on-year for the last fortnight and refrigerator sales are up by 18%, industry insiders said. Soft drink sales have surged 15%-20% while ice-cream sales are up 30%-40%. The early and sudden onset of summer, marked by heat waves and scanty pre-monsoon rains in most parts of the country, has caught several consumer goods marketers unawares and there is already a shortage of air-conditioners and refrigerators in several markets, accor- ding to trade sources.
Industry experts said the early trends point to a record summer quarter for these product segments.
“After years, sales have surged from March itself,” said Pradeep Bakshi, president and chief operating officer at Tata-owned Voltas, leading airconditioner maker in the country.
“Since air-conditioner sales is directly proportionate to discomfort, the high temperatures since March should lead to a strong industry growth this season,” he said. Voltas has sold more than double the air-conditioners of what it had sold last year during the first fortnight of April.
LG India, the other top player in this market, reported doubling of air-conditioner sales in some markets, while overall sales grew by 50% in South and West, with East and North too picking up now. Vijaya Babu, LG India's business he- ad for air-conditioners, said demand is high even from tier two towns like Patiala, Anand and Vijayawada. He said the real surprise has been Bengaluru, which is traditionally one of the smaller markets due to its usually pleasant and moderate climate throughout the year, but has reported highest growth this year. Cola trade insiders said both CocaCola and PepsiCo are seeing a revival of sorts in consumption of aerated drinks on an average of 15%-20% already. “Demand is up and we’re seeing comparatively higher growth rates this season after a lull. Volume growth remains higher than value growth,” a top official from the industry said. Both the beverages giants had seen sales staggering to low single digits or even sliding over the past five-six quarters. Over the last couple of months, Coca-Cola had halted production at plants in Andhra Pradesh, Jaipur, Uttar Pradesh and two in the Northeast, citing lack of demand.
Seasonal summer products, too, are seeing brisk sales. “Consumer demand of some of our seasonal products is near double that of last year,” said Subhashis Basu, business head for dairy products at Mother Dairy Fruit & Vegetables. RJ Corp-owned ice-cream maker Creambell has already increased its target for the quarter, its chief executive Nitin Arora said. He claimed Creambell has been outpacing industry growth by 50%.
The India Meteorological Department has predicted higher than normal temperature for this month and weather websites have predicted similar weather in May as well.