New Delhi - Consumer durable makers expect a double-digit growth in sales this festive season despite a hike in customs duty as most of them have chosen to absorb the impact and not pass it on to consumers, according to industry players.
Despite factors such as depreciation of the Indian rupee and increase in crude oil prices, manufacturers like Panasonic, Haier, Godrej Appliance and BSH Household Appliances are trying to keep alive the spirits of the festive season which accounts for around 25 per cent annual sales starting from Onam in the south and goes up to the Durga Puja and Diwali.
This year, festive season sales in the south have been already washed away by floods in Kerala. Moreover, the increase in basic customs duty to 20 per cent on import of fully manufactured AC, refrigerator and washing machine along with the increase in customs duty on compressors has impacted the market sentiment.
“An increase in prices of compressors will lead to a definite price hike for refrigerators and ACs which will impact the market sentiment. But, for the upcoming festive season, we will be absorbing maximum costs in order to keep the festive spirits going. We will relook at revising the prices post this festive season,” Panasonic India president and CEO Manish Sharma said.
Godrej Appliances business head & executive vice-president Kamal Nandi said, “Since bulk of imports of components and finished goods for festive would have already happened at the industry level, we do not foresee an immediate jump in prices during festive. Even if there is some impact, manufacturers will try to hold back the price hikes to avoid dampening festive sentiments as much as possible.”
“Festive season should be good. We are quite optimistic about it even though the customs duty has gone up. We have done a lot of marketing to promote Haier in the festive season. Overall we have spent more than Rs 40 crore on marketing campaign during the festive season,” said Haier India president Eric Braganza.
BSH Household Appliances MD & CEO Gunjan Srivastava said, “We will continue to invest in our ongoing 360-degree marketing campaigns where digital platforms will continue to play an important role and also offer special finance schemes to our consumers. This festive season, we will be investing about 25 per cent higher than last year.”