HomeNewsAC makers see 2nd consecutive busy season washout

AC makers see 2nd consecutive busy season washout

Calendar year 2021 is no different from year CY2020 for air conditioner manufacturers – year starting off well, fuelling good busy season sales’ hope and Covid-19 led lockdown taking it away. This has left the inventory level with the industry at almost last year’s level. With on-time arrival of Monsoon in the South, the industry will have to depend upon North to salvage some revenue in remaining period of the busy season.

Though the lockdown norms this year are not as stringent as they were last year AC makers have lost good amount of summer season sales as75%-80% of retail shops were closed. In some states like Maharashtra and Karnataka there was complete shutdown of retail stores and malls. Some states have allowed retail activities but with operational hours strictly limited to only 4-5 hours on a daily basis. Most of the large format retail and trade channels have utilized their online platforms for retailing activities. Though the situation was better than last year still its nowhere near the pre-Covid level.

For example, inventory level of Voltas, the leading brand in the industry was at 20-25 days at March-end which currently stands at 45-60 days across India. Further, the inventory level in Maharashtra and South states will be higher as the peak season is almost over similar to last year.

However, most of the AC makers don’t rule out strong bounce back of demand in the second quarter of the financial year as most of the states have started relaxing lockdown norms.

Meanwhile, Highly and GMCC have established compressor manufacturing units in the country and will likely to have less than 2 million combined capacity while demand is at 6 million units.

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