The much-awaited Goods and Services Tax (GST), once implemented in July later this year, will make air conditioner costlier by 5 to 7 per cent.
An industry expert said that in July-September due to growing raw material prices and the possible implementation of the GST, the prices of air conditioners will go up.
"Raw material prices like copper, aluminium and steel have been steadily rising for the last few quarters. The proposed GST bracket for us would be 28 per cent, which is disappointing for the industry. All these could lead to a price hike by up to 5-7 per cent in July-September," B Thiagarajan, Joint Managing Director, Blue Star Ltd. said.
Talking about sales growth projections in the next financial year starting from April, he said that the company should clock a 15-20 per cent rise in revenue from the room air conditioners segment in 2017-18.
"The air conditioner industry grew by 20 per cent in October-December despite the demonetisation impact, so there is no reason to believe that growth in the summer season and thereafter would not be in double digits," he said at the launch of new inverter split air conditioner range.
Thiagarajan also said that the company will invest about Rs 3.5 billion over the next three years on two new manufacturing units in Jammu and Kashmir and Andhra Pradesh.
