PL Sector Update - Consumer Durables - Room Air Conditioner (RAC) Channel Check update (June-2023)

Prabhudas Lilladher Pvt Ltd
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Prabhudas Lilladher Pvt Ltd

Highlights

Consumer Durables - Praveen Sahay - Research Analyst, Prabhudas Lilladher Pvt Ltd

Consumer Durables - Praveen Sahay - Research Analyst, Prabhudas Lilladher Pvt Ltd

Room Air Conditioner (RAC) Channel Check update (June-2023)

We connected with 13 dealers of RAC across India to gauge the summer season’s demand/pricing scenario. As per our interaction, demand for Room Air Conditioners were moderate and North India stands most affected due to unseasonal rains. Below key takeaways:-

Competitive Price to continue

Due to intense competition, brands have not yet taken any price hike.

Soft Demand in summer season

Volumes picked up by April end, however May-June were again impacted due to unseasonal rains (mostly in North India). West India saw pick up in May-23 with severe summer, while dealers were still at lower sales volume compared to previous year’s summer season. Demand may further stand impacted with the upcoming rainy season.

RAC Inventory at normal level

Our channel checks suggest that inventory is at normal level, an average of around 45 days at dealer’s level.

Other highlights

The most selling product in RAC segment is 1.5 ton 3-star AC’s of Voltas and Daikin. In the high end range, Mitsubishi and O-General AC’s are preferred.

Exhibit 1: Channel Check details

Location Demand Price Inventory
North India
Dealer 1 Saharanpur, UP Low (vs last season) in April-May No Price hike 40-50 days
Dealer 2 West Delhi Low (vs last season) in April-May around 50 days
Dealer 3 Chittorgarh, Rajasthan Normal demand No Price hike
Dealer 4 Gurugram, Haryana Low (vs last season) in April-May No Price hike 45-55days
South India
Dealer 1 Bangalore, KA Normal demand No Price hike 40-45 days
Dealer 2 Karimnagar, Telangana Normal demand No Price hike
West India
Dealer 1 Ahmedabad, MH Low (vs last season) in April-May No Price hike 50-55days
Dealer 2 Nagpur, MH Low (vs last season) in April-May Pricing same since Jan Medium inventory at 45 days
Dealer 3 Aurangabad, MH Low (vs last season), pick up in May while low in June No Price hike
Dealer 4 Mumbai, MH Low (vs last season) in April-May No Price hike
Dealer 5 Nagpur, MH Low (vs last season) in April-May No Price hike 50-55 days
Dealer 6 Mumbai, MH Low (vs last season) in April-May, pickup in April end No Price hike 35-40 days
Dealer 7 Mumbai, MH Low (vs last season) in April-May No Price hike

Source: PL

Exhibit 2: Channel Check Summar

Date Dealers Connected Brands - dealer Category Price Promotion & discounts Inventory Demand
Feb'23 8 Bluestar & Daikin RAC
- 40-50 days Expected to increase in Mar'23
Mar'23 30 Voltas & Lloyd RAC
around 15% 35 days Expected to increase by end of month
April'23 20 Voltas & Bluestar RAC
- 25-35 days Increased in April
June'23 13 Voltas, Bluestar & Llyod RAC
- 45 days Low - Affected due to unseasonal rains


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