New Delhi: Godrej Appliances, a division of Godrej and Boyce Mfg. Co. Ltd, said it expects a 30% jump in revenue to touch close to 3,600 crore in fiscal 2015-2016 on the back of a revival in consumer demand for appliances. The company expects air conditioners (ACs) to be the fastest growing segment, followed by refrigerators and washing machines. It is targeting sales of 300,000 ACs during calendar year 2015, up from 220,000 units sold in 2014.

“ACs should grow the fastest since penetration levels are the lowest and we are witnessing hotter summers year after year," said Kamal Nandi, business head and executive vice-president at Godrej Appliances.

AC manufacturers in India sold about 3.3 million units in fiscal 2013-14. Currently, at 28 million ACs in the country, their penetration rate is about 3-3.5%.

According to the Consumer Electronics and Appliances Manufacturers Association, the AC numbers would reach 45-50 million in the next two-three years. Nandi also expects prices to stabilize for the appliances industry in 2015.

“In 2015, we are seeing stability in price for most products because global economy is not doing well, we don’t see too much inflation in commodity prices and the oil prices are down, which will keep the prices stable. Also, interest rates in India are going down, which will help revive the purchase sentiment," he said. “We have already taken 2-3% hike and if the excise duty is rolled back, it will be passed on to the consumer."

Godrej Appliances, which is expecting a revenue of 2,800 crore in fiscal 2014-15, posted sales of 2,000 crore a year ago.

“The market looks positive and part of it because the demand has not been met in two years. People have deferred on their purchases for some time now and this year we are likely to see that demand back in the market," said Pinaki Ranjan Mishra, partner and national leader at consultancy firm EY. “Even the economic environment is better...inflation has been under control."

The company has planned over 60 launches across AC, washing machine and refrigerator categories this year.

Nandi expects to invest 5% of the company’s revenue in 2015 towards marketing and advertising. It is also planning to enhance its presence across channels. The company expects close to 2% of its sales from online channels where it will continue to partner with online firms such as Flipkart. Godrej has also started selling via its own online platform. “It will take time for us to develop and popularize our own website; we will largely depend on online firms for sales in 2015-2016," he said.

The company will add 4,000 new outlets in the next fiscal year. It currently has a network of about 26,000 sales outlets in the country. According to Nandi, 2014 saw growth in the market after the government offered a 12% concession on excise duty. “Up to December, the appliance industry has grown by 30% over last year as we saw some stability in prices. Cooling products have been the maximum contributor and even washing machines grew by 17%," he said.

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