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While the ongoing commodity cost inflation has led to price increases across products, the upcoming Bureau of Energy Efficiency rating change in January 2022 is expected to result in further increase prices by 7-8%.
Hence, the company’s management views this to be a headwind for growth of the room air conditioner industry.
The government does have an option to reduce goods and services tax rates, but the management believes it won’t happen in the next two years looking at government finances.
It expects growth to moderate to 10% compound annual growth rate versus its earlier expectation of 15%.
This implies that penetration levels may remain lower going forward.
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