Haier Appliances Expects Up To 30% Growth In Festive Season Post GST Cut

Haier Appliances India, an appliance & Consumer electronics maker, expects around 25 to 30% growth this festive season, helped by GST reduction on large screen TV sets and room-air conditioners, its President NS Satish has said.

The company, which is investing Rs 1,500 crore in its Greater Noida-based plant and scouting land for a new factory in South India to cater to the domestic and export opportunities, said this GST reduction is expected to increase the localisation drive and 'make-in-India' project.

"Definitely, the GST benefit will increase the consumption. So as the consumption increases, the scale of production also goes up. So, obviously, the investment, which we had already planned, will take it on a faster track," Satish told PTI.

According to Satish, this GST reform is "one of the boldest moves" by the government of India to boost the economy.

Earlier this month, the government, as part of its next-generation GST reforms, reduced the duty on TV screens above 32-inch screen size and RAC from the highest sub of 28% to 18%.

"A customer who was planning to buy a 43-inch (screen size) TV probably will go for a 55-inch now or from somebody who was planning to buy a 55 inches will go for a 65-inches,' he said, adding '... with this move, we see at least a growth of minimum 20-25% growth should come in the flat panel business'.

On festive sales, Satish said Navratra will start soon, and sales are expected to go increase with the introduction of new prices. "... across the category, we definitely see at least a minimum, 25 to 30% growth should come during this peak period.'"

To attract customers, Haier India has planned new product launches for the festive season and is investing in a marketing and branding campaign. The company is introducing consumer-friendly EMI schemes and cashback offers.

On RAC, Satish said the household penetration is only 11% in comparison to 80-85% in developed countries.

"With the temperature going up, barring this year, the natural demand for RAC will go up... And with the push from the government in terms of localising the PLI schemes, which have been done, it will really help in terms of bringing down the cost of the product and ensuring the right quality products are manufactured in India," he said.

Over the inventory of SKUs with old prices, Satish said, "The dealers who are holding inventory, we have already communicated to them that, from Sept. 22, they should sell at the new GST. We have asked them to change the MRP stickers. Even in our warehouses, we are changing it."

Currently, India is the fourth-largest market for Shandong, China-based Haier Group Corporation, and Satish expects it to become one of the top three markets globally in the next 4-5 years with a sales revenue of $2 billion.