What do you have the say about the current scenario of the air-conditioning industry in India? The demand-supply ratio statistics?
While the second wave of the pandemic interrupted recovery during the last summer season, it had a lesser impact on the supply side. The industry was saddled with inventory since the second wave happened in the high summer season, for second year in a row. Post which, consumer demand continued to gradually recover as the lockdowns imposed were only state-wide as against national lockdowns that happened during the first wave. As the situation improved, the summer season was already over, plus there was impact of commodity price hikes, in the later part of the year in 2021.
As the year opened in 2022, the third wave engulfed the nation and again there is a pile up of AC inventory. Currently, looking at the decline in the number of covid cases we foresee a bullish demand this summer. Our factory is now gearing up for full peak load production.
Technically what advancement do we see in the appliance from your brand? Share with us the details about the same.
Despite COVID -19 related lockdowns in the country, Godrej Appliances has kept up impetus on offering consumers the latest in technology by launching 30 SKUs in the Air Conditioner category last year. We had also launched new range of R290 Refrigerant based Inverter Split Air Conditioners in March 2021.
The coming summer will see a host of new ACs from Godrej offering great cooling which has been our strength, but also new benefits in health, IoT enabled smart controls, efficiency, durability and superior aesthetics.
The pandemic has brought about a greater focus on health and hygiene aspect in any product that consumers purchase. To cater to this demand, we launched Anti-Viral Nano Coated Filter, in our in-house manufactured air conditioners, which provides 99.9%+ virus sterilization and is effective against bacteria and air-borne pathogens. This year we are taking it further with advanced UVC based disinfecting air conditioners.
Higher internet penetration and increased access to smartphones has revolutionised consumer behaviour, and the pandemic has increased digital familiarity by leaps and bounds, therefore improving demand and acceptance of IoT enabled devices. Keeping this in mind we are launching IOT enabled Smart ACs that are wifi and voice powered with smart phone connectivity for remote monitoring and scheduling.
Rising temperatures year on year has been an ongoing challenge for consumers. Godrej ACs have always been known for great cooling and we continue to offer it with lower derating technology that enables our ACs to perform optimally, even during harsh summers when regular ACs fall short.
We stand by our commitment towards the environment and will be offering super-efficient ACs once again delivering substantial energy saving to consumers. Godrej is also the only brand to also offer R290 based ACs with the least global warming refrigerant technology.
When consumers buy a Godrej AC, they buy into trusted quality and our products are designed to be more durable and technologically superior.
The new range of Godrej D Series Air Conditioners not just offers the above benefits but also sets a new benchmark on aesthetics.
The market of air-conditioning is competitive, how are your products different from your competitors? Why should consumers buy your appliance?
Over the last seven years, much before made in India became a clarion call, the brand invested Rs. 1100 crore in capacity, R&D, and technology expansion, demonstrating its commitment to ‘Make in India’ and has introduced 100% Made in India ACs. In a highly fragmented market, Godrej is still the only brand in India providing ACs with one of the lowest GWP (Global Warming Potential) Hydrocarbon-based refrigerant R290 in India. Attesting its commitment towards Green, this is a giant leap by the brand. These models are being manufactured in-house, with the fully backward integrated plant consisting of Plastic Injection Mold, Outdoor Sheet Metal Parts, Heat Exchangers, etc.
The AC manufacturing plant at Shirwal near Pune, aims at creating products that will add value to the life of a customer. The plant is also awarded the prestigious “Platinum GreenCo” certification by CII Green Business Centre for TUV-certified manufacturing. With modern, state-of-the-art manufacturing technologies and equipment adhering to international quality standards and manufacturing processes. Godrej Appliances constantly develops products at par with global market, with superior quality and reliability.
While, we have a complete range in terms of 5 Star & 3 Star inverter split ACs, the brand is also focusing on higher tonnage SKUs like 2 Tr split ACs. Godrej is one of the few brands in India, which is offering 2Tr split ACs even in 5 Star inverter & 3 Star inverter, and thus has the complete line-up in 2 Tr split AC segment.
Overall, our proposition in terms of our AC product line up comes with strong durability and lowest derating at high temperatures which delivers sustained cooling even at high ambient temperatures. Plus, in this year’s product line-up, we are adding strong emphasis on Health & Hygiene through Nano Coated Filters & more. Our IoT line up will cater to the ever-growing smart homes in India. We have always been known for setting the benchmarks on energy efficiency and we will keep up our focus on offering consumers green and super power saving ACs. In short, our portfolio is designed to meet all the consumer needs when it comes to ACs.
There is a huge untapped market with substantially lower penetration of consumer appliances, what are your thoughts about the same.
Air conditioner is one of the lowest penetrated product categories in India, with only 5% penetration. But, with an increase in India’s GDP and per capita income and given the trend of rising temperatures, in this forthcoming decade, we will see an inflection point where air conditioners will see huge growth. However, to support this growth, this category needs support in terms of rationalisation of GST and even more so for energy efficient products.
Are you of the view that emerging rural areas have a great potential for appliances? Share your views.
Given the low penetration levels of the AC category, the growth will continue to come from urban households. The increasing number of urban cities and towns, improving connectivity, affordability and access, coupled with rising temperatures year on year will drive Air Conditioner adoption. Rural India will probably adopt direct cool refrigerators and semi-automatic washing machines first as the quality of electrification and affordability improves.
100 per cent FDI allowed in the electronics hardware-manufacturing sector under the automatic route, do you think this will give much needed boost to the sector. Your take.
FDI coupled with PLI will give a boost to the semi-conductor and electronics industry. For air conditioners, with a higher shift towards inverter split AC, there is a strong need to develop supply chain cluster for inverter controller drives and PCBs, in India. India is still behind China or Taiwan in terms of electronics or semi-conductor production cluster, but PLI is a good start and will aid India to fulfil the domestic demand for electronics and semiconductor indigenously, in the long run.
Your business projections for the metros and tier II and III cities? How has been the response from these cities?
For ACs, business will get primarily driven by metro, tier 2 & 3 cities. Within our AC business, the company’s share of pie is around 80% in these markets.
In the days to come what new, can we see from the brand, visually and technically?
The brand’s manufacturing footprint is now spread across 1.50 lakh sq. ft., and it has made a considerable investment in its Shirwal plant near Pune, dedicated to machinery, tools, infrastructure and backward integration for the air conditioner category including AC heat exchanger coils and indoor units.
The indigenous manufacturing expansion is helping us offer a wider portfolio to our consumers, with greater design possibilities. The coming portfolio will stand out on aesthetics and span multiple consumer benefits – spread across health – Nano and UVC Technology based ACs; smart IoT enabled controls for voice controls, remote monitoring and diagnosis etc; coupled with greater durability, powerful cooling, super energy efficiency with high ISEER, eco-friendly least global warming ACs and more!