Blue Star's Managing Director B Thiagarajan spoke to T E
Narasimhan on how sales are expected to touch pre-Covid-19 levels during
festival time and there are chances it may increase by 10 per cent
Amidst the
pandemic, air conditioning and commercial refrigeration major Blue Star is
seeing a pickup in demand for products catering to healthcare, pharma, FMCG,
food industry and residential needs.
Blue
Star's Managing Director B Thiagarajan spoke to T E Narasimhan on how sales
are expected to touch pre-Covid-19 levels during festival time and there are
chances it may increase by 10 per cent compared to last year.
What kind of
impact did Covid-19 have on the AC industry?
In the wake of the
coronavirus pandemic and economic disruptions, the AC industry lost most of its
peak time sales in the first quarter -- the April-June period when most of the
sales of cooling products happen as summer peaks. However, the residential
segment is recovering faster and is at a 90% level at present. Recovery would
be slower in commercial segments such as offices, malls, hotels, cinemas, halls
and restaurants. Offices are a large segment in the commercial cooling business
and will take a long time to recover. However, some segments like food
retail, food delivery, manufacturing, dairy, food processing, pharma, FMCG,
banking, financial services, and insurance sectors are doing well.
How is the
festival season expected to be? Will it reach last year's level?
Whatever lost in
Q1 is lost. It was 50 per cent of sales in Q1. In Q2, the market has recovered
to 80 per cent of last year's levels. In Q3, it will be 90 per cent of last
year and in Q4, the industry will reach around 100 per cent. There is a
possibility that the industry can even grow by 10 per cent in Q4. Government
push like reduction in GST from 28 per cent to 18 per cent will make the ACs
affordable and will push the sales. It is a revenue-neutral proposition, and I
urge the GST Council to consider this appeal.
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