AC manufacturers record highest-ever sales in May, experts foresee a growth in AC sales by 30-35% in current fiscal

As the country is reeling under a severe heatwave with mercury breaching previous highs in many places, air-conditioner manufacturers in India are navigating exceptional demand. AC manufacturing companies have recorded the best-ever sales in a month so far in May.

As a result, the companies are grappling with long delays in installation and fulfilling inventory demand for high-selling energy-efficient models. In most states, the temperature is hovering around 45 degrees including the national capital.

Industry experts forecast an overall growth of 30-35% in the current fiscal compared to the previous year. Prominent players in the market like Voltas, Daikin, LG, Panasonic and Blue Star have recorded the highest sales last month.

Voltas saw a two-fold jump in the sales of residential AC in May, hoping the positive momentum to continue in the remaining period of the April-June quarter, according to its MD & CEO Pradeep Bakshi.

"As we reflect on May 2024, Voltas has a remarkable surge in sales, showcasing a stupendous volume growth of 100% compared to the same period last year. This milestone is particularly significant as May historically stands as one of the highest contributing months in the AC and cooling products industry," Bakshi said.

On the other hand, the Tata Group is also expecting 2 million units of AC sales within the first half of 2024.

Similarly, LG Electronics India said, due to a multi-fold surge in demand the company has managed to beat the last five years’ record. It is witnessing an "exponential growth" in its AC segment.

According to Blue Star Managing Director B Thiagarajan, the room AC industry enjoyed a 40% growth. Moreover, the sector also dodged the anticipated hiccups during May due to the general elections, he said.

"In April the demand went skyrocketing. Then we thought that it would slow down in May but it did not because of sales from the northern region," Thiagarajan said, confirming that the industry sales are up 70 per cent. At the same time, he also added that due to high sales in May, the queue for installations remained unmanageably long, with unprecedented service-related calls. The companies were not prepared for this boom in sales.

Even in April, AC manufacturers reported robust sales resulting in their shares surging considerably. In April, Voltas shares jumped 13% after the company reported highest-ever AC sales. Its shares gained over 67% in the past six months.

Shares of Blue Star Ltd. surged over 61% in the last six months and above 10% over the past month.

With the heat wave showing no signs of abating, companies are expecting more sales in the coming months as well.