Penetration of Air Conditioners in India is Still Very Low

Air conditioner sales in India are expected to grow with a CAGR of more than 10 percent over the next 4 years. With the continuous inflow of disposable income and the advancement of technology, the need for the varied consumer durable goods is on a rise. This in turn has led to a strong competition between different consumer durable brands and the price gap between the same consumer goods of different companies is also narrowing down. India is one of the major developing countries with a huge middle class population base and rising per capita income. In comparison to other developing countries, the market penetration of air conditioners is still very low in India, which in turn provides a huge opportunity to players.

The window air conditioners market is on a decline with the popularity of spilt air conditioners in the country. Some companies have even stopped making window air conditioners because of its inflection point where there is no innovation possible and the entire market is shifting toward the split segment. On the other hand, split air conditioners are high in demand as they are easy to install and the price gap between window and split air conditioners has also become very less. Consumers nowadays prefer energy-efficient smart appliances due to rising energy prices. The commercial segment is also catching up with the increase in demand of commercial plots, offices, stores, factories, and business apartments. Light commercial air conditioners dominate the commercial segment.

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