Panasonic is hoping to sell more air-conditioners in 2019-20 with the forecast of a harsh summer. Last year, a moderate summer had led to a flat sale of air-conditioners for all major manufacturers, including Panasonic.
Hot summer and strong air-conditioner sales have a high degree of correlation. Financial year 2016 was good for the manufacturers as the summer was hot that year and everyone in the industry benefited. However, 2017 was a moderate year in terms of business and 2018 was bad.
Higher demand expected
“This year, we are expecting good demand,” said Gaurav Sah, Business Head, Air Conditioners Group, Panasonic India.
In the South, AC sales begins in January and ends in May while in the North, it happens from late February till mid-July, he told BusinessLine. “I have not seen two moderate summer seasons in a row. All manufacturers suffered a setback last April (the highest selling month) where the overall industry slumped by nearly 20 per cent. The industry could not recover last year. We were also in line with the industry trend. However, this year, we expect better sales,” he said.
The AC business unit of Panasonic India is likely to clock a 6 per cent revenue growth to ₹1,225 crore for the current year ending March 31, 2019, as against ₹1,156 crore in the previous year.
“Our target is to achieve 15 per cent growth to around ₹1,400 crore in 2019-20,” he said. The AC unit contributes nearly 12 per cent of Panasonic India revenue, he added.
The revenue growth is aided by sale of high-end inverter products that provides higher average realisation per unit. For instance, there is going to be a 2 per cent increase in volume to 3.25 lakh units (3.22 lakh units) but the revenue growth will be around 6 per cent, he said.
Sah was here to launch the company’s new range of ACs with superior technology such as Nanoe and AG clean filter to remove harmful particles and provide clean air. The new series ACs are available in ranges between ₹39,900 and ₹53,990 in 3-star and 5-star category across 1, 1.2, 1.5 and 2 tonne variants, he said.
The company, Sah said, wants to increase production at its manufacturing facility in Haryana to reduce per unit cost. For this, it is increasing focus on exports to Africa, West Asia, Bangladesh and Sri Lanka. The factory has an installed capacity to manufacture 10 lakh units annually, but the current production is only around 4.5 lakh.―The Hindu Business Line