Subdued demand for ACs in Q4 dampens Panasonic’s FY24 topline growth

Home appliances, which continue to be the face of the brand for a majority of Indians, contribute under 30% to the brand’s overall revenue generated in the country.

Bengaluru: Electronics major Panasonic is anticipating the year-on-year topline growth of its India business in financial year 2023-24 to dip to approximately 8 per cent from an earlier projection of low double digits owing to lower-than-expected demand for air conditioners in the fourth quarter of the fiscal, Chairman of Panasonic Life Solutions India and South Asia, Manish Sharma, told DH here on Thursday. 

“The fourth quarter dependency on cooling products is very high. It was a bit of a delayed winter this time. We were expecting February to be warmer but it was not and it impacted quite significantly. So, some air conditioner sales got delayed,” he explained. 

Home appliances, which continue to be the face of the brand for a majority of Indians, contribute under 30 per cent to the brand’s overall revenue generated in the country.

While manufacturers and retailers across the consumer durables industry are ramping up inventory of cooling products such as fans, air conditioners, refrigerators and air coolers in anticipation of a strong summer, sales in the fourth quarter of the ongoing fiscal have been lacklustre owing to a myriad of reasons including inflation-linked price hikes and unseasonal rains in the back half of March.

“Both revenue and profit are going to grow… we may look at roughly about Rs 11,300-11,400 crore of revenue,” Sharma said, adding that the electric works segment comprising lighting and wiring fixtures, switches and so on, dominates contribution to the overall turnover in India.

Panasonic’s businesses across six different areas in India cumulatively account for about 2 per cent of the brand’s overall global revenue. Sharma however added, “In the consideration set, India would be sitting on the top for sure. Every year senior level visits continue to happen in India and that would be exceptional to other geographies while the dependency on the topline from the US, Europe, China, Asian markets would be bigger than India. ” 

Elaborating on consumer patterns in the white goods industry in India, Sharma said: “Premiumisation is happening much faster. People are preferring products which are helping them multitask.” 

Sharma disclosed that the brand’s avionics facility in Pune is expected to commence operations latest by July this year. He also alluded to a major partnership announcement scheduled for later this week.