Home-grown firm Godrej Appliances expects to become a billion-dollar company by the end of this fiscal, led by a 30 per cent growth in topline, a senior company executive said.
Godrej Appliances, a unit of Godrej & Boyce, recorded 60 per cent overall growth in the first quarter, led by an unprecedented demand for air-conditioners
Home-grown firm Godrej Appliances expects to become a billion-dollar company by the end of this fiscal, led by a 30 per cent growth in topline, a senior company executive said.
The company is "very optimistic" about the short-term and mid-term outlook of the domestic market, during which it will launch new products and has plans to launch around 50 new models across categories in FY25, its Business Head & Executive Vice President Kamal Nandi told PTI.
Godrej Appliances, a unit of Godrej & Boyce, recorded 60 per cent overall growth in the first quarter, led by an unprecedented demand for air-conditioners.
"We have registered over 60 per cent growth in Q1 and expect to close the quarter at 50-60 per cent growth. While demand is slower in the south and west, north and east are improving. Overall, we expect to close the quarter with over 50 per cent growth," Nandi said.
In categories such as air-conditioner, Godrej Appliances recorded over 100 per cent growth in sales, as some other makers have reported.
In the air-cooler segment, the Godrej group firm saw over 125 per cent growth and more than 25 per cent in the refrigerators segment in the June quarter so far.
"Even if consumption slows in the festive season and the September quarter, we anticipate a normal growth of about 15 per cent over last year, aiming to close the year around 30 per cent, plus growth overall," he said.
Godrej Appliances closed 2023-24, around Rs 6,000 crore. According to Nandi: "We are expecting a 30 per cent increase, aiming for close to Rs 8,000 crore."
Asked if Godrej Appliances would become a billion-dollar company by the end of FY25, Nandi said, "Yes, we are expecting to reach that target." Godrej Appliances operates in segments such as air conditioning, refrigerators, washing machines and kitchen appliances such as microwave ovens.
Besides, it is also present in the commercial appliances space, such as in vending machines, and is expanding its range of medical refrigerators. Over the demand, Nandi said the good part is, both rural and urban areas are seeing equal demand.
"Rural demand has picked up, and the consumption of mass market products has increased. Premium products continue to grow, but mass-market consumption is notable," he added.
Godrej Appliances gets 65 per cent sales from metro and tier-I cities, while the rest comes from tier-II, III and IV markets. This year, the company is having a "great summer" after a long time, which has pushed the sales of compressor-based cooling products. Godrej Appliances' focus was on its logistics and supply chain to meet the sudden demand.
"The last time we saw such a spike in demand during summer was in 2009-2010, and then again in 2019. The year 2016 was another good summer. The cooling categories have done extremely well," he said.
Last year, its air-conditioner business contributed around 30 per cent of its business, which is now expected to cross 40 per cent in FY25. "While another 40 per cent comes from refrigerators and about 18 per cent will come from washing machines. The balance comes from air coolers and freezers," Nandi added.
Godrej Appliances has recently expanded its research and development facility at Pirangut, Pune. Besides, the Godrej Group firm is also expanding its sales network.
"Over the last three months, we have increased our reach by about 30 per cent month-on-month," he said. Over the last 5-6 years, Godrej Appliances -- which has a manufacturing plant at Shirwal near Pune and another in Mohali -- has invested over Rs 1,200 crore, primarily on manufacturing and product development.
"Today, we have a refrigerator capacity of about 3.6 million units, an AC capacity of about 0.9 million units, a washing machine capacity of about 1 million units, and a chest freezer capacity of 0.3 million units," he said.
The company also exports to neighbouring markets such as Nepal, Sri Lanka and some parts of Africa, but the focus is on the domestic market, Nandi added.