Demand for cooling appliances, particularly air conditioners (ACs), has slowed sharply in June compared with May as the peak summer buying cycle eases and consumers remain cautious amid higher prices, industry executives told FE. Persistent price increases over recent months have also pushed some entry-level buyers towards lower-cost alternatives such as air coolers and fans.
In contrast, fast-moving consumer goods such as beverages and ice cream have seen strong growth in June as consumers continue to seek relief from high temperatures.
“Sales growth rates for ACs in June have slowed to around 10-15% versus 30-35% seen in May,” NS Satish, chief executive officer, Haier Appliances India, said. “Input costs remain elevated across several categories, including ACs, requiring calibrated pricing actions. Consumers are increasingly focused on value, particularly in larger appliances,” he said.
Kamal Nandi, business head and executive vice-president, appliances business, Godrej Enterprises Group, said sentiment for AC purchases has remained weak in June, with April and May accounting for the bulk of seasonal buying.
“Demand for ACs was at its peak in April-May when temperatures first spiked. This has curtailed fresh purchases in June despite the ongoing heatwave,” he said.
Industry executives also pointed to intermittent rainfall across several regions that temporarily eased temperatures, further moderating demand for cooling appliances even during peak summer conditions.
Weather Disruption
While AC sales have softened, categories such as ice cream and packaged beverages have continued to post strong growth. Amul and Mother Dairy have reported nearly 50% growth in ice cream volumes in June, while beverage makers are seeing robust demand for carbonated drinks, juices and hydration products.
“The current heatwave has created a favourable environment for daily-consumption categories,” said Jayen Mehta, managing director of Gujarat Co-operative Milk Marketing Federation (GCMMF), which markets the Amul brand. “Consumers are prioritising products that offer immediate refreshment and remain accessible at lower price points.
Margin Pressures
The AC segment, meanwhile, continues to face pressure from higher input costs. Manufacturers had increased prices by around 12–13% between January and April to offset rising raw material and compliance expenses.
“Demand is not uniform as consumers remain largely cautious. Inflationary pressures have also led consumers to pull back on discretionary spending,” B Thiagarajan, managing director of Blue Star, said.
While some players, including Godrej, have refrained from further price increases in June amid cautious consumer sentiment, others have continued to pass on costs. Haier has implemented a third round of price hikes of around 5% across most durable categories, excluding ACs, in June.
Satish said the company may consider another round of price increases of around 3-4% in July as manufacturers continue to grapple with elevated input costs.