As temperatures breach 40-45 degrees Celsius across several parts of the country, India’s summer economy is running at full throttle this year. This is in contrast to the rain-hit summer season last year, which resulted in a decline in demand for cooling products.
Sales of cooling appliances, cold beverages, and ice cream have surged by up to 35-40% this month compared with last year, industry executives said, prompting companies to ramp up production and strengthen supply chains amid expectations of sustained demand through June. The sales surge in May also comes after a mixed April, marked by unseasonal rains in the north, south and east of India. The May sales surge is also in line with the sales growth rate seen in May of 2024, when the summer was strong that year.
The India Meteorological Department (IMD) has forecast that severe heatwave conditions are likely to continue across parts of the north, west and central India till the end of May, with temperatures in several regions crossing 45 degrees Celsius.
Manufacturers are now operating plants at higher capacities and strengthening supply chains to avoid stock shortages during the peak summer season. Retailers in major cities, including Delhi, Mumbai, Jaipur, Lucknow and Ahmedabad, have reported faster sell-through for inverter ACs, coolers and refrigerators over the past fortnight. Some dealers said premium and energy-efficient appliances are seeing stronger traction despite elevated prices.
“We have seen a sharp uptick in demand across air conditioners and refrigerators in the last few weeks. Sales growth has been around 35-40% versus last year. We are hoping this momentum will continue into June,” NS Satish, chief executive officer, Haier Appliances India, said.
“India is a tropical country with long summers and high ambient temperatures. We remain optimistic of clocking good growth in Q1 (of FY27) as air conditioners have become a household necessity,” Sanjay Chitkara, director and co-chief sales and marketing officer at LG Electronics India, said.
Market Volume Expansion
Industry estimates suggest the domestic room air-conditioner market, which is around 12-13 million units in size, has recorded volume growth of nearly 35% in May compared with the same period last year. The domestic refrigerator market, around 18 million units in size, has seen volume growth of around 20-25% in May versus last year. This is despite brands taking around 10-12% hike in ACs and refrigerators between January and April to mitigate input cost pressures, as well as a revision in energy efficiency norms.
The beverage and ice-cream segments, too, are witnessing a similar boom. For beverage makers, in particular, rural markets are contributing meaningfully to growth after improved distribution reach and wider availability through kirana stores and quick commerce channels.
Soft drink makers have expanded bottling operations and increased dispatches to retail outlets as demand for carbonated drinks, juices and packaged water spikes sharply. Industry executives said sales of summer beverages have risen between 30% and 40% in May, particularly in northern and western markets.
“Summer sales expectations remain robust as demand conditions have been favourable,” Ravi Jaipuria, chairman, Varun Beverages, PepsiCo’s key bottling partner outside the US, said.
Ice-cream manufacturers too are seeing robust off-take across urban centres, tourist destinations and neighbourhood retail stores.
Quick Commerce Catalyst
“We are witnessing a notable uptick in consumer demand across our portfolio. Categories such as ice creams, fresh dairy products and dairy beverages have seen heightened traction. On quick commerce platforms alone, ice cream volumes have more than doubled over the last 10 days compared to the preceding 10-day period, while fresh dairy products have registered growth of over 30% during the same timeframe. We now expect demand growth to surpass our earlier estimates for the season, “Jayatheertha Chary, managing director (MD), Mother Dairy, said.
“We are seeing broad-based growth across both impulse and take-home formats, which gives us strong confidence in the overall business outlook for the summer season,” Debabrata Mukherjee, MD, Lotte Icecreams (Havmor), said.
Analysts said the intensity of the summer this year has created favourable conditions for seasonal categories, benefiting companies across appliances, beverages and packaged consumer goods.
However, experts caution that supply-side constraints such as compressor shortages, logistics bottlenecks and rising commodity and fuel costs could pose challenges to demand.