The Hindu : Smart revival seen in refrigerators

Online edition of India's National Newspaper
Sunday, Mar 21, 2004

Business

Business

Smart revival seen in refrigerators

By Our Staff Correspondent

CHENNAI, MARCH 20. The market for refrigerators, which has been struggling with an average growth of around 5 per cent since 1999, is likely to get charged in 2004-05 reaching sales of 4.1-4.2 million units, from the projected 3.65 million units in 2003-04, according to a Francis Kanoi Marketing Research report.

The report is one of the largest household-based studies being conducted, with sample sizes ranging from two lakhs to 3.5 lakhs, tracking the purchase of durables since 1988.

The market for refrigerators missed a substantial part of the impact of the economic rebound in 2003-04, consequent to widespread rains that occurred in the third quarter of the financial year and the peak sales months for refrigerators, especially in the North, during summer months. In fact, the refrigerator segment suffered the brunt of the impact of widespread drought during the previous year, in the peak sales months of 2003-04. And it was only robust sales during the festival seasons subsequently that led to an overall 7 per cent growth during the year.

The current forecast says that it is the slack created due to depressed sales during the peak season last year, together with the extended underperformance of the market over the previous five years that is likely to propel the market to a double digit growth in 2004-05. If the economic environment continues to be positive after the next monsoon, the growth, in fact, may touch 15 per cent. The last time a 15 per cent growth was achieved by the refrigerators fields was way back in 1995-96.

A double-digit growth in sales in 2004-05 will reduce considerable pressure on the market leader, Whirlpool, in facing competition from LG. Whirlpool happens to be the last brand standing in the way of total domination of the consumer electronics and appliances field in the country by LG. If Whirlpool loses its top position to LG, it will only be a question of time before it yields to Samsung as well.

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