The consumer durable and electronics industry is betting on premium, feature-led products to drive double-digit growth in 2023. Brands are expecting most growth to come from tier-II and beyond towns with consumers looking at ‘smart, connected, comfortable and convenient appliances’ which is giving a further push to demand for high-value appliances that are easy to use and energy efficient. “Overall the industry is expected to grow at 10-15 per cent in FY 23-24 and Godrej Appliances is expecting 20 per cent growth in this period. This growth will be primarily led by the premium segment. We have also planned for significant investments and have new launches coming up as well,” Kamal Nandi, Business Head and Executive Vice President, Godrej Appliances, told FinancialExpress.com. Industry body CEAMA too is ‘optimistics about good growth in 2023’ and expects to almost double the value of the industry in the next three years to Rs 1.48 lakh crore by 2025. Manish Sharma, Chairman, Panasonic Life Solutions India, agreed, ” Today the industry is on a steady growth trajectory backed by rise in demand for premium appliances, improving economy and positive consumer sentiments. We, at Panasonic, are anticipating stable business growth driven by positive consumer sentiments.”
Meanwhile, Ravi Saxena, Founder, and CEO, Wonderchef, said, “After a 75 per cent growth over the last two years, we are again expecting a blockbuster year with a 40 per cent increase in sales in 2023.”
Deepak Bansal, VP – Home Appliances & Air Conditioners, LG India, told PTI, “We are betting big on 2023 as we will be launching a robust product portfolio based on Indian insights.” While the external global environment remains a challenge due to geopolitical and inflation issues, Deepak Bansal said that ‘positive consumer sentiment post-pandemic is certainly a good signal’.
“In 2023, there is potential to target 3X of the industry growth and we have planned to launch new products across categories that will appeal to consumers, keen to upgrade their appliances,” Satish NS, President, Haier Appliances India, told FinancialExpress.com
The ‘premium’ trend to continue
While there is a huge scope for growth in sales and revenue generation from the rural areas in 2023, what will be the trend that will drive this growth? Like the year gone by, the demand for premium, feature-led products will continue to drive the consumer durables and electronics industry in 2023. “Although inflation affected consumer sentiment in the mass segments, premium segments remained buoyant. We have witnessed growth in premium segments over mass segments across geographies and channels. For Godrej Appliances, the premium segment has grown over 100 per cent in comparison to the pre-pandemic period FY 19-20. Additionally, we have been witnessing more traction for appliances delivering higher convenience, larger capacities, and health-first innovative features with latest technologies,” said Kamal Nandi.
The inclination towards premium and feature-led products continued in the last year even as the industry took a price hike of 15-20 per cent across products due to increase in costs of raw material like aluminum and nickel, transportation and crude. “We are hoping that the overall inflationary trend will witness a decline, and we may notice an increase in discretionary spending on items like consumer appliances,” said Ravindra Singh Negi, Chief Operating Officer – Consumer Products, Bajaj Electricals Limited. He added that the brand is looking at an increase in demand for premium products in the coming months.
The year gone by
Even as the new year is looking promising for the consumer durables and electronics segment, retail brands registered growth during 2022 in spite of the looming inflationary pressure. “Haier India registered a growth of 30 per cent in the year 2022. With more than 90 per cent of Haier products locally manufactured from our industrial parks in Ranjangaon, Pune, and Greater Noida, UP, we have been able to consistently reinforce our purpose towards ‘Made in India and ‘Made for India’, with no significant impact on consumer prices at the moment,” said Satish NS. Wonderchef also delivered a 30 per cent growth in 2022 over the last year and ‘has outgrown the industry by over 2X’.
Meanwhile, Manish Sharma said, “In terms of value, we grew double digits recording 15 per cent growth Jan-Nov’22 vs Jan-Nov’21. We observed a record demand for Air Conditioners as we witnessed more than 35 per cent growth vs Jan-Nov’21.” For Godrej Appliances as well, the premium segment has grown over 100 per cent in comparison to pre-pandemic period FY19-20. “In FY 22-23, Godrej Appliances has achieved more than 66 per cent growth over last year, at par with the industry growth rate,” concluded Kamal Nandi.