Sales of ACS, cooling products feel the heat in peak season
For the second consecutive year, sales of air conditioners (ACS) and refrigerators have been hit during the peak season of April and May due to the localised lockdowns and restrictions on account of surging Covid cases in the country.
The pandemic situation has forced companies to recalibrate their target and go for pre-covid (2019) sales number without being too aspirational.
Leading players in the segment including Voltas, Daikin, Blue Star, Panasonic and Haier reported almost 75% dip in April sales this year when compared with the same month of 2019 performance. Moreover, May 2021 has been a complete washout so far for them.
On top of the present situation, consumer sentiment has been further hit amid reports that there may be a third wave of the pandemic, which further dampens chances of a recovery in sales of compressor-based cooling products such as ACS, refrigerators etc, as people are preferring to keep expenses on hold till the time Covid situation improves.
Leading AC maker Voltas said it was expecting a doubledigit growth this fiscal but now the second wave and subsequent restrictions have led to a recalibration of targets. “Initially while budgeting, we had a lot of aspirations to grow more than double digits — but now due to the first quarter getting washed out, our endeavour will be to catch up with last year,” Voltas MD and CEO Pradeep Bakshi told PTI.
Expressing similar views, Daikin Airconditioning India MD & CEO Kanwal Jeet Jawa said: “If we are able to achieve what we have done in 2019, that would be good enough.” Last year, April was washed out and May was just 10% (of May 2019) and June was less than 25% of (June 2019 sales). Sales in April this year were 80% of those clocked in the corresponding month of 2019 as only first 15 days of the month were good in terms of activities. May is looking like a complete washout and June could be 75% of 2019, Jawa said. Panasonic India and South Asia President and CEO Manish Sharma said the sale of AC started in March on a positive note, but due to the sudden surge in the number of cases in the second wave and most of the states imposing partial lockdowns, summer sales are being hit.
“We are keeping a close watch on the situation but, we may see a loss of over 50 per cent against sales projections during the ongoing quarter (April-june). We have inventories in stock to ensure a smooth purchase experience for our partners and consumers across offline and online channels,” he said.
Normally, the April-june quarter, as mercury rises in the peak summer, contributes around 30 to 35% to overall sales of ACS and other compressors based cooling products.