Weathering the Slump: Ankur Bisen on the Evolution of India's Consumer Durables Market

Makers of air conditioners, refrigerators, and fans expected a major boost following the reduction of GST on consumer durables (smart TVs, ACs, washing machines) from 28% to 18%. However, the December quarter turned out to be a “quarter to forget,” plagued by policy shifts and external macroeconomic factors.

In a recent analysis published in Mint by Neethi Lisa Rojan, The Knowledge Company (TKC) Senior Partner Ankur Bisen shed light on how the industry is adapting to these unpredictable shifts.

Despite the tax benefits, listed durable makers reported exceptionally weak financials. Customers delayed purchases in Q2 waiting for the GST cuts to take effect in September, and fiercely competitive pricing meant sellers had to pass the benefits entirely to consumers.

Several pressures converged to suppress demand and erode margins:

• Regulatory Cost Hikes: Prices of cooling appliances rose 5-10% from January 1st due to the implementation of new, revised star ratings by the Bureau of Energy Efficiency (BEE).

• Commodity Inflation: Copper prices surged by approximately 60% over the past 12 months, severely impacting manufacturing costs.

• Rupee Depreciation: Management across top brands acknowledged that a weaker rupee further drove up the cost of imported components.

• Commercial Sluggishness: Demand connected to the FMCG sector—specifically commercial refrigeration for ice creams and Quick Service Restaurants (QSR)—failed to bounce back as anticipated.

One of the most significant disruptors of the quarter was the weather. India experienced a longer-than-usual winter, prolonged by the effects of La Nina. However, as Ankur Bisen points out, consumer durable brands are actively evolving their product portfolios to hedge against weather dependency.

This transition from strictly summer-focused appliances to year-round utility products is a crucial strategic shift, allowing brands to maintain sales momentum even during harsh winters.

The outlook for the March quarter remains highly positive. With summer beginning in the southern states and aggressive discounting across major e-commerce platforms, brands like Voltas, Blue Star, and LG expect a strong revival and normalization of demand heading into FY27.

The Knowledge Company’s strategic advisory practice helps consumer durables brands navigate volatile macroeconomic landscapes.

• Product Portfolio Strategy: We assist brands in identifying geographic and seasonal white spaces, such as the rising demand for all-season appliances in North India.

• Supply Chain Resilience: Advising on pricing and inventory strategies to manage commodity inflation and currency depreciation.

• Regulatory Navigation: Helping organizations proactively adapt to shifting BEE mandates and import codes to protect operating margins.

Is your product portfolio resilient enough to weather shifting consumer and climate trends? Connect with TKC to build a future-ready retail strategy.