According to some analysts, Energy Efficiency Services Ltd’s proposed entry into retail segment may have some impact on pricing pressure for small-medium players. However, the industry doesn’t expect any material impact on larger players due to entry of EESL. On the other hand, entry by EESL in B2C segment is likely to increase the market growth rates.
While the consumers prefer to buy larger products based on brands, look of the product and efficiency, the impact will be higher in commodity linked categories such as lighting, say some analysts. Analysts expect the lighting market may see another round of higher competitive pressures.
Last week, state-run Energy Efficiency Services Ltd (EESL) announced its plans to increase its presence in the business-to-consumer (B2C) retail space through offline and online channels, with products such as smart bulbs, inverter bulbs, energy efficient ACs, fans and induction cooking stoves with an initial investment of around 330 crore. EESL already has an online presence through EESLmart.in. It plans to roll out some stores in July itself.
The new stores will be a combination of own outlets, franchises and tie-ups with the Department of Posts and CSC (Common Service Centre). These two entities had assisted in the distribution of LED bulbs under the Ujala scheme. While EESL would be the front end, it plans to invite tenders from manufacturing companies to make energy-efficient products.