Blue Star, a prominent player in India’s air conditioner market, is anticipating a 25% surge in sales as the upcoming summer is forecasted to be hotter than usual, leading to robust demand for cooling appliances.
Managing Director of Blue Star, B. Thiagarajan, expressed optimism regarding the summer season, stating that early signs indicate favorable conditions for the AC segment. He attributed this positive outlook not only to the expected weather conditions but also to a brighter economic outlook, which is anticipated to drive consumer spending.
This optimism follows a period of disappointment for Blue Star, as its AC sales fell short of projections last summer due to unexpectedly cooler weather conditions. To address this, the company is introducing new models and increasing its advertising expenditure to enhance competitiveness in the market, which includes rivals like Voltas, owned by the Tata Group, and Daikin Industries from Japan.
In a bid to strengthen its market presence, Blue Star is doubling its advertising budget to 400 million rupees ($4.8 million). This increased spending will be directed towards securing advertising slots during popular events such as the Indian Premier League cricket tournament, which coincides with the country’s general elections this year. Despite challenges posed by inflation, particularly in rural areas, the impact on AC makers is expected to be less severe due to their predominantly affluent customer base.
Thiagarajan highlighted that a significant portion of Blue Star’s sales comes from small cities and towns, with approximately 90% of all AC purchases being made by first-time buyers. Looking ahead, the company aims to achieve revenue of around 100 billion rupees by the end of the fiscal year, marking a notable increase from the previous fiscal year’s revenue of 79.77 billion rupees.
