The ongoing second wave would adversely affect the sales of cooling appliances. Air-conditioners, coolers, and fans are all included.
AC is a very seasonal product because more than 70% of air-conditioner sales happen between January and June, according to a report by brokerage Motilal Oswal. It further said that the three-month period from March to May provides 50% of the year sales and anything that hinders during this period has a disproportionate outcome on sales.
In addition, ACs require installation, and the consumer would think twice before bringing technicians to their homes in the current pandemic scenario. Although this is the case, the general mass knows that companies handled this situation last time around.
Companies were waiting for a good season, owing to the forecast of a scorching summer in different parts of India. However, the current rise in Covid cases has led to lockdowns, majorly in parts of India where AC manufacturers had set their eyes on.
The report said that the second wave eventually directed to the announcement of lockdowns across different decisive consumption states in April 2021.
However, the south side fared marginally better than other regions, although the surge in cases and the lockdowns that follow restrained manufacturers for secondary sales across crucial locations in the nation.
Mint had stated earlier that companies have decided to partially pull out of production due to lower demand. That is all the more true for companies holding a long list of fans, coolers, and air-conditioners.
The report also stated that extensive lockdowns would push the demands, similar to last summer.
The report added that, according to channel feedback, the cause of the second wave could direct to demand lag by the tail consumer. This, in turn, would pose a threat to AC sales in the crucial seasons.
Demand was confined very tightly for non-seasonal and non-discretionary months, while that same demand was probable in playing out in ACs this season.
With rising urbanization and technological advancement in the aforementioned key states and cities in India, the plummet of AC manufacturing and everything along those lines is becoming graver than before.
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