India’s major consumer electronics and home appliance manufacturers such as LG, Samsung, Bosch, Siemens, Panasonic, Godrej Appliances and Haier posted the best sales of the past five years in August, which is good news for the Indian economy, which contracted 23.9% in the three months ended June 30, 2020.
The good news was that the top-selling products last month were large refrigerators, washing machines, high-end dishwashers and microwaves, indicating that discretionary demand is back.
Big companies have said that Independence Day sales in the e-commerce markets were “massive” and that the return of consumer finance has also helped. The companies estimate that they increased their sales 25 to 40% in August from the previous year, while sequential sales growth in July is more than 20%, the Economic Times reported.
“The demand continues to increase, we have published our best August performance in more than five years – a 40% increase in sales,” LG vice president Vijay Babu told Daily Business. LG Electronics is the largest appliance manufacturer in the country. Neeraj Bahl, CEO of BSH Home Appliances India, which makes Bosch and Siemens home appliances, said its performance in August was the best in a decade in terms of revenue and unit sales. “We hope the Christmas season is good, although Onam in Kerala has been relatively moderate,” Bahl told the publication.
The companies said the demand was more for high-capacity products: refrigerators of more than 300 liters, washing machines of more than 6 kg and products such as microwaves and dishwashers. Consumers also buy large TVs with screen sizes of 40 inches or more, according to the publication.
Panasonic India CEO Manish Sharma said the favorable monsoon, working from home, improving consumer confidence and increasing the number of new buyers in rural markets are driving this demand. Consumers in all markets prefer large-screen LED televisions to smartphones for streaming content, he said.
Every month, businesses experience a growing demand for televisions, appliances and personal care products due to changes in consumer habits. In fact, most large companies had reached pre-Covid activity levels in July. This had caused a shortage of certain products such as dishwashers due to a sudden increase in demand.
Eric Braganza, president of Higher India, told Daily Business that the brand had the highest sales on television in August. “This is despite the fact that 10 to 15% of the stores remain closed due to local closures. We are now optimistic about the Christmas season despite the contraction in GDP growth, thanks to the bumper harvest, rural markets are doing exceptionally well and there is a change in consumption patterns as well, ”he said.
If August is any indication, there may be a lot of holiday cheer for the big consumer electronics brands. The Christmas season, which begins with Navratri and runs through Diwali, typically accounts for 40-45% of the annual activity of home appliance manufacturers.