Air conditioner makers double profits despite scorching heat

Whirlpool of India’s consolidated profit jumped 89.4% to Rs 145.3 crore and operating revenue rose 22.5% to Rs 2,496.9 crore.

3 minutes reading Last updated: August 15, 2024 | 10:34 a.m. IST

Air conditioner makers have reported double-digit revenue growth and several saw their profits more than double in the April-June quarter, driven by increased demand due to the scorching summer.

Companies such as Voltas, Blue Star, Whirlpool of India, Johnson Hitachi and Havells, owner of the Lloyds brand, reported a strong growth trajectory in their top and bottom lines, driven by record sales during the April-June period.

Tata Group company Voltas, a major player in the indoor air conditioner segment, reported a doubling of its consolidated net profit to Rs 335 crore and its operating revenue increased by 46.46 per cent to Rs 4,921 crore.

Voltas also announced that it has achieved the ‘milestone’ of one million units of AC sales in Q1 FY25 and its total revenue crossed Rs 5,000 crore during the period.

During the first quarter of this fiscal, Voltas’ revenue from ‘unitary cooling products for comfort and commercial use’ under its space air conditioning business segment grew 51.24 per cent to Rs 3,802.17 crore. Its overall volume grew 67 per cent in the air conditioning segment during the April-June period.

“The unitary cooling products business continued to outperform the market and maintained its growth momentum,” he said, adding, “Voltas continues to be a market leader in split and window air conditioners with an exit market share of 21.2% as of June 2024.

Blue Star also reported a two-fold increase in its consolidated net profit to Rs 168.76 crore, while its operating revenue rose 28.72 per cent to Rs 2,865.37 crore during the June quarter.

Its revenue from unit products, which includes sales of room air conditioners, grew 44.31 per cent to Rs 1,729.52 crore during the period.

“With most parts of the country experiencing extremely high temperatures and an overall harsh summer, the increased demand has led to unprecedented growth in the room air conditioner sector,” he said.

During the quarter, demand exceeded the company’s inventory plans and, while the company met most of the excess needs through increased production, it still lost some opportunities to meet the full demand offered by the season, Blue Star said.

Similarly, Havells reported a profit of Rs 67.39 crore from Lloyd’s business, which deals with its room air conditioning business. It had reported a loss of Rs 61.48 crore in the same period last year.

Revenue from Lloyd Business, a brand acquired by Havells in 2017, grew 47.43 per cent to Rs 1,924 crore.

On the earnings call, Havells management said that “the air conditioner business has done a great job” and that it has seen many new buyers of air conditioners.

“…We believe this could trigger an inflection point for the under-penetrated air conditioning sector,” he said.

Whirlpool of India’s consolidated profit jumped 89.4% to Rs 145.3 crore and operating revenue rose 22.5% to Rs 2,496.9 crore.

Its revenue growth was driven by growth in the refrigerator and air conditioner segment, the company said in its earnings release.

Johnson Controls-Hitachi Air Conditioning India, which sells residential air conditioners under the Hitachi brand, also reported over 76% growth in revenue at Rs 982.29 crore in the June quarter in the ‘cooling products for comfort and commercial use’ segment.

Consumer Electronics and Appliances Manufacturers Association (CEAMA) President Sunil Vachani had earlier said he expected the annual sales volumes of room air conditioners to be around 14 million.

First published: August 15, 2024 | 10:06 a.m. IST