Consumer electronic companies expect a significant jump in penetration of household appliances like refrigerators, washing machines,ACand televisions in the next 2-4 years thanks to the interim budget’s focus on housing for the middle class, rural areas and solar energy schemes for households.Executives said these budget measures will act as a catalyst in sales for appliances since a jump in the housing sector is a huge positive for the industry.
Havells India chairman and managing director Anil Rai Gupta said the housing schemes will open up huge opportunities for the electrical and appliance sales improving demand in the mid-to-long term, while the solarisation scheme will create opportunities to sell solar appliances.
Leading home grown electronic contract manufacturer Dixon Technologies chairman Sunil Vachani said households going for the solarisation scheme can save money which would boost their discretionary spending. “There is an opportunity for a huge spurt in demand for the sector,” he said.
Finance minister Nirmala Sitharaman in her interim budget laid some plans to be implemented over the next five years if the government returns to power after the general elections. This includes rooftop solarization where one crore households can obtain up to 300 unit free electricity every month whereby they save up to Rs 15,000-18,000 annually, she said.
Sitharaman said the government will launch a scheme for middle class living in rented houses, slums and unauthorized colonies to buy or build their own houses. She said the government will also construct two crore new houses in the rural areas over the next five years.
Godrej Appliances business head Kamal Nandi said the benefits from the housing, urbanization boost and solar energy schemes in the interim budget will boost sales in the medium to long term, and there were no boosters for the industry in the short run.
The white goods industry has been growing sales by 6-8% by value in the last 2-3 years due to increase of product prices and premiumisation with sales of mass products and in rural India under stress. This has impacted volume growth or number of units sold for the industry. Penetration of appliances and electronic products varies by category such as 55-60% for televisions and 7-8% for AC.
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