Air-conditioner makers witnessed strong growth in the months of April and May but there was a dip in June due to changes in weather patterns as well as inflationary pressures.
Players said the industry has recorded a volume growth in June quarter over the same period last year, which was a washed-out summer season but remained flattish compared to Q1 FY25.
Analysts pointed there was some softening of demand due to price hikes taken by AC players to mitigate the impact of higher raw material costs and rupee depreciation.
Kamal Nandi, Business Head and EVP at Appliances Business of Godrej Enterprises Group, said, “ Overall the June quarter was much better for air-conditioners compared to last year. Both April and May were good months but in June we have seen some drop in demand due to change in weather patterns. This is also due to postponement in discretionary spending by consumers due to inflationary pressures. The industry was expecting that due to El Nino effect, we will see strong demand even in June but that is not visible on the ground.”
As per some estimates, players have increased prices from 5-20 per cent depending on the brand and product models.
Blue Star, MD, B Thiagarajan said that the industry is expected to end June quarter with value growth of 30 per cent over previous fiscal. “ The key concern is that margins are under pressure for the industry due to higher raw material costs among other factors. Players have not passed on the full impact of higher raw material cost to consumers,” he added.
Analysts said that the industry has recorded strong growth in June quarter compared to the same period previous fiscal. However, compared to June quarter of FY25, the growth will be flattish.
A report by Motilal Oswal Financial Services noted that the demand environment was increasingly influenced by region-specific weather patterns during the June quarter.
“Near-term performance in the RAC segment is likely to be driven more by regional heat intensity, product mix, scheme offerings, and execution quality than by a pan-India volume upcycle,” the report noted.
Outlining regional variances, the report added that demand in the Southern region remained relatively resilient. However, in North and Central India, demand remained heavily weather-driven with strong sales from late-April to May but softened in June due to unseasonal rains.
Higher price-sensitivity was seen among consumers in the Eastern region, the report noted.
Published on June 27, 2026
