Cool for ice creams, freezing for ACs, refrigerators

Tarun Narayan & Mona Mehta in Mumbai

There has been a change of season and the fast-moving consumer goods (FMCG) industry will once again see a shift in its consumption pattern. The short summer months have given way to the rainy season. There are a number of products in the FMCG segment whose fortunes shift with the change in the season. Financial Express takes a dekko at some of the key segments and analyses how they have done in the last season.

* The summer of 2001 has been a cool one for the Rs 2,000-crore ice cream industry. That has also been reflected in last season’s sales. This trend is revealed in ORG’s latest data on ice cream brands in the major consuming markets of Delhi and Mumbai.

As per data by ORG, the marketshare of Hindustan Lever Ltd (HLL) — which is the market leader with a 50 per cent share nationally — in the Delhi ice cream market has gone up to 48 per cent in April 2001, from 43 per cent in March 2001.

“Some of the significant initiatives undertaken by HLL this time round like new product innovations, introduction of Doodh Badam flavour under Max, Feast Jaljeera, Sundae tubs for Kwality Walls and new cup flavours of Mango and Chocolate under Max arrived as a significant strategy to consolidate the equity for ice cream brands,” says a HLL spokesperson.

In Mumbai, the second largest city in ice cream consumption, HLL’s marketshare has gone up to 40.8 per cent in April 2001, from 37.1 per cent in March 2001.

Amul, the ice cream brand of Gujarat Co-operative Milk Marketing Federation (GCMMF), has achieved an impressive growth in the first three months of this peak summer, claims GCMMF general manager marketing Mr RS Sodhi.

According to Mr Sodhi: “At the all-India level, our total sales (to include our sister concern, Mother Dairy), in terms of volumes has touched 24 million litres this year, wherein this summer has generated 40 per cent of the contribution.”

Informs Mr Sodhi: “Amul has achieved 50 per cent growth in all existing markets this summer wherein the ice cream market is growing at a rate of 20 per cent currently compared to the growth of 15 per cent last year. We target to continue growing at 50 per cent in ice cream in the coming two years.”

* In the consumer durables segment, for refrigerators and air conditioners, the summer that is just past has been a short one compared to last year. This has resulted in stagnant growths across the sector. A glimpse at the performance of some companies engaged in the manufacture of white and brown goods reveals the trend.

According to Philips India senior vice-president (consumer electronics) Mr Rajeev Karwal: “This summer, demand for air conditioners and refrigerators has been only 10 to 15 per cent against the anticipated 25 to 30 per cent.” Informs CETMA ex-president Mr KS Raman: “The growth in the air conditioners market has dropped from 25 to 30 per cent last year to about 10 per cent this year. The growth in the refrigerator market is stagnant at zero per cent, compared to five per cent last year. As regards the growth estimates for the next summer, while the AC market is expected to grow at 25 per cent refrigerators could be at a steady five to 10 per cent.”

Of the total number of 5.50 million units of air conditioners sold this summer (compared to 4.80 million units sold last summer), it is estimated that Videocon has achieved a marketshare of 20 per cent this year compared to 16 per cent last year. LG would have recorded a growth in marketshare from 10 per cent last year to 12 per cent this year, while National has achieved a share of seven per cent this year from 4 per cent last year. Godrej Appliances claims to have garnered a marketshare of five per cent in this segment.

According to Mr Raman: “In the air conditioner segment, Voltas’ marketshare has not grown more than 10 per cent this year. Amtrex Hitachi’s marketshare has remained static at seven per cent and so is the case with National and Samsung’s marketshares, which are steady at four per cent for the past two years.”

According to Godrej Appliances executive vice president marketing, sales and service Mr Soumitra Ghatak: “In the just ended summer of 2001, the market for refrigerators flattened at a near-zero per cent growth compared to a growth of five to seven per cent recorded last summer.”

In the refrigerators market, Godrej’s share has remained static at 20 per cent compared to last year. Godrej Appliances recorded a 15 to 20 per cent growth in sales this year, compared to last year when it sold two lakh plus pieces of refrigerators, claims Mr Ghatak.

Videocon International chairman and managing director Mr VN Dhoot says: “This year, the summer has been very good for the sales of all our products as compared to last year. Videocon’s marketshare in refrigerators has grown from 13 per cent to sixteen per cent, whereas in air conditioners, the share has picked up from 16 per cent last year to 20 per cent this year.”

Adds Mr Dhoot: “We estimate that the market to grow at 10 per cent for refrigerators and 15 per cent for air conditioners next
summer.”