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From hatchbacks to holidays, consumers ready to loosen purse strings

By Akshara Srivastava, Sharleen D'Souza, & Sohini Das
September 01, 2023 12:31 IST
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With Onam and Raksha Bandhan just around the corner, the festival season is ready to kick off in full swing. As people embrace the celebratory spirit, companies anticipate a surge in sales this year.


Illustration: Dominic Xavier/

Consumer durables firms are expecting strong growth of 40-50 per cent in the premium segment during the upcoming season.

Appliance makers also foresee increased demand for cooling appliances — refrigerators and air conditioners — which were impacted by unseasonal rainfall.

Kamal Nandi, business head and executive vice-president at Godrej Appliances, stated, “If Onam is an indicator, the festival season should perform well, especially in the premium segment.


"We have also planned a few more launches in September.”

He added that they expect a 40 per cent growth in the premium segment during the festival season compared to last year.

While the mass segment continues to lag, Nandi mentioned that sales might be higher by 20 per cent.

Anticipating higher demand, television (TV) maker Super Plastronics (SPPL) also raised the production of TV panels by 20-30 per cent.

Avneet Singh Marwah, chief executive officer (CEO) of SPPL, the brand licensee of Kodak, Thomson, Blaupunkt, and White-Westinghouse in India, said, “This festival season is expected to be good as there have been market hiccups throughout the year.

"The two major sporting events — the World Cup and Asia Cup — will also drive the sales of TV sets.”

He added that they anticipate a 50 per cent growth compared to last year in 40-inch TV sets and above, and a 100 per cent growth in 55-inch TV sets and above.

In the fast-moving consumer goods sector, Parle Products expects robust growth this year.

Mayank Shah, senior category head at Parle Products, said, “This year, both urban and rural areas should perform well, as inflation has eased and demand is experiencing a revival.

"We project value growth of 10-11 per cent and volumes in the range of 4-5 per cent.”

Automobile companies are also witnessing increased demand in light of the season.

Shashank Srivastava, senior executive officer, marketing and sales, Maruti Suzuki India (MSIL), said, “Onam has already seen a 25 per cent increase in bookings, which is a promising start to the season.

"However, poor August rainfall could dampen rural demand sentiment. Since 80 per cent of retail sales are financed, higher interest rates due to inflationary pressures could be another potential dampener.”

This year’s festival season spans 83 days, up from 71 days last year.

“The peak in the past 10 years was 92 days in 2021 when the highest-ever festival sales occurred, with 935,000 vehicles sold. Roughly 23-26 per cent of annual sales occur during the festival season,” he added.

By these projections, we expect 1 million vehicle sales this year (with annual sales projected at 4 million).

This would mark the highest-ever festival season sales for passenger vehicles.

Industry booking levels are at 700,000 units, and the semiconductor chip supply issue is largely resolved,” Srivastava said.

A dealer in western India stated that there is high demand for sport utility vehicles (SUVs), and companies with an SUV-focused portfolio might perform well, along with those offering a mix of hatchbacks and SUVs.

“We anticipate around 30 per cent growth in demand during the festival season starting in September, compared to the previous months,” said Rishi Dada, owner of Dada Motors, a Tata Motors dealership.

Manish Raj Singhania, president of Federation of Automobile Dealers Associations of India, noted that dealer inventory levels have reached around 50 days, but dealers are optimistic about better liquidation during the season.

Despatches are being sent to regions where festivities begin.

The travel sector is also experiencing an upswing ahead of the season.

According to Thomas Cook, metro routes are witnessing approximately a 10 per cent increase in pricing compared to last year.

“Additionally, return fares to Tier-II and Tier-III cities like Bhubaneswar, Indore, Lucknow, and Jaipur from hubs like Mumbai, Delhi, and Bengaluru are higher by 5-15 per cent, as India’s migrant working professionals travel back to their hometowns,” said Indiver Rastogi, president and group head, global business travel, Thomas Cook (India) and SOTC Travel.

“Given that India tends to book travel late, we anticipate a strong growth trajectory for the upcoming festival season, peaking towards September,” Rastogi added.

The hospitality industry also expects heightened activity in the coming weeks.

Rajesh Magow, co-founder and group CEO of MakeMyTrip, stated, “We are witnessing double-digit growth in bookings for Cochin, Thiruvananthapuram, Munnar, Alleppey, Thrissur, Kannur, and Kollam during Onam.”

Luxury hotels like Tamara in Coorg and Kodaikanal are anticipating increased occupancy levels.

Hotels noted that the increase in occupancy typically accompanies an average room tariff rate growth of almost 10 per cent.

They expect this trend to continue throughout the season.

Special activities like Onam special meals and Sadhya have been organised for travellers during the festivities.

Courtyard by Marriott in Aravali Resort, near New Delhi, expects higher demand for accommodations, dining experiences, and special festival offerings like value-added packages during the season.

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Akshara Srivastava, Sharleen D'Souza, & Sohini Das New Delhi/Mumbai
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