Mumbai: Consumer durables and appliances manufacturer Panasonic India said it remains bullish about growing at more than twice the market rate for the next three years even though there are some short-term blips given the ban on large denomination currency notes.

“We are going ahead with our plans of manufacturing and sales," said Manish Sharma, president and chief executive officer, Panasonic India and South Asia and executive officer, Panasonic Corp.

According to Sharma who is also the president of the Consumer Electronics and Appliances Manufacturers Association (CEAMA), the consumer durables sector is extremely dependent on cash and hence there will be a short-term impact of demonetisation. However, given the 7th pay commission hand-outs and good monsoons, demand will pickup, said Sharma.

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Also, close to 30-35% of the sales in the sector are through consumer finance and the majority of the interest costs at 80-85% on these financing schemes are borne by the manufacturer, making transactions attractive for the consumer.

On Tuesday, the company announced an investment of Rs115 crore for setting up a factory in Jhajjar, Haryana for manufacturing refrigerators. It is also strengthening its R&D function in order to expand its appliances business in India, said Tetsuro Homma, senior managing director, member of board and president, appliances company at Panasonic Corp.

The factory will have capacity for 500,000 units and be operational by November 2017, said Sharma, adding that it would help the company double its sales in the refrigeration business from the targeted Rs330 crore in financial year 2017 to Rs600 crore in financial year 2018.

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In financial year 2016, Panasonic India recorded sales of Rs8,700 crore and is expecting to close the fiscal year 2017 with sales of Rs10,800 crore, said Sharma. He, however, did not disclose the profit numbers but said the company will post a small profit this year as it had broken even two years ago.

Panasonic India has been growing at a compounded average rate of 25% annually for the last three years and hopes to drive growth at a similar rate for the next three years, said Sharma. Meanwhile, the consumer durables industry has been growing at 10%, driven by rural India which is growing at a higher clip of 17-18% while urban India has been growing at 6.5%, he said.

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