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Rediff.com  » Business » Voltas pips LG, Samsung in domestic AC market

Voltas pips LG, Samsung in domestic AC market

October 25, 2012 11:38 IST

Backed by product innovations, Tata group company Voltas has surpassed its South Korean rivals in the domestic air conditioning market.

According to a recent study by GFK Nielsen, in August, Voltas was the market leader, with a 20.6 per cent share in the air conditioning market. Voltas was followed by LG Electronics India (15 per cent market share) and Samsung Electronics (12 per cent market share).

Voltas, which had a market share of 15.7 per cent in first quarter of 2010-11, saw its share drop to 14.9 per cent in the fourth quarter FY12. However, in July, this rose to 21 per cent.

LG, the market leader in the first quarter, with a share of 28.8 per cent, saw its share fall to 15 per cent in August, according to GFK Nielsen data. Samsung's share fell from 21.4 per cent in the first quarter to 12 per cent in August.

Samsung has said it has exited the window AC market. In the split AC segment, it had a 15.6 per cent market share, the company said, citing GFK data.

In value terms, the company claimed it had a 19.9 per cent share in the overall AC market in India in the January-August 2011 period. LG Electronics had said its all-India cumulative share in the AC market in August stood at 19.4 per cent.

Pradeep Bakshi, chief operating officer, Voltas unitary products business group, said, "In the cooling products segment, we grew 20 per cent in volume and about 30 per cent in value during the summer. This growth is attributed to a prolonged summer, aggressive marketing of all-weather ACs introduced about six months earlier, consolidation of our retail footprint in the North and expansion in east and south India." Currently, Voltas has about 6,000 consumer touchpoints across the country.

For FY13, Bakshi is targeting volume growth of at least 15 per cent. He says the company would continue to bank on all-weather ACs to maintain its leadership in the home cooling segment.

It might also consider introducing new categories in the next financial year, he added. As metro markets become saturated, Bakshi hopes Tier-II and Tier-III cities would become growth drivers, contributing about 50 per cent to the company's annual sales.

"The up-country market is picking up very fast," he says. Retail and distribution sales account for 85 per cent of the company's sales; the remaining 15 per cent comes from institutional sales.

In the last financial year, prices of ACs were raised 15-20 per cent two to three times. "I don't see any immediate price rises. However, there could be price increases before the next summer," Bakshi said.

Sounak Mitra in New Delhi
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