Challenging Season Ahead for Room Air-Conditioner Industry Amid West Asia Crisis and Rising Costs

The room air-conditioner industry faces a tough summer with rising input costs due to the West Asia crisis, delayed hot weather, and inflationary pressures. Blue Star's Managing Director expects double-digit growth despite these challenges. Price hikes are anticipated post-war, with demand increasing in Southern states, though concerns persist in Kerala.

The room air-conditioner industry is bracing for a challenging summer as it confronts escalating input costs due to ongoing geopolitical tensions in West Asia and delayed onset of hot weather. Blue Star's Managing Director, B Thiagarajan, pointed out that the industry's cost pressures are being exacerbated by the rise in plastic and steel prices, fueled by the Iran-US conflict.

Although these challenges loom large, Thiagarajan maintains a cautiously optimistic outlook, forecasting double-digit growth over the previous year. He anticipates a potential 20 percent growth, driven by the industry's adaptability in navigating economic hurdles. Despite predicted price hikes coinciding with festive sales, consumer demand in the southern states, such as Tamil Nadu and Maharashtra, remains strong, counterbalancing slower uptake in Kerala.

With new energy efficiency standards now effective, the room air-conditioner industry continues to innovate, addressing a wide range of consumer needs through Blue Star's latest launch of 125 models. The domestic RAC market is poised for expansion, projected to reach 30 million units by FY30, propelled by first-time buyers and replacement demands in less urbanized regions.

(With inputs from agencies.)