Restrictions may impact sales in short-term, pent-up demand will release soon after: Godrej's Kamal Nandi

Godrej Appliances is manufacturing medical refrigerators at its Shirwal facility in Satara, Maharashtra. However, other appliance production in the state is now temporarily suspended till April 30 due to state government restrictions.

April 15, 2021 / 05:29 PM IST
Kamal Nandi, Business Head and Executive Vice President, Godrej Appliances

Kamal Nandi, Business Head and Executive Vice President, Godrej Appliances

The Maharashtra state government has put in place a series of restrictions to minimise the COVID-19 spread. This includes restrictions on non-essential manufacturing across the state, meaning that only medical supplies related production can continue.

In an interaction with Moneycontrol, Kamal Nandi, Business Head and Executive Vice President-Godrej Appliances said that while the restrictions could lead to some short-term impact on sales in the state, the pent-up demand will be released as soon as the curbs are lifted. Excerpts:

What is the impact of the fresh restrictions in Maharashtra?

The restrictions are till May 1. While this would lead to some impact on sales in the short-term, there is a pent-up demand that will be released as soon as the curbs are lifted.

For us, our production facility at Shirwal in Satara, Maharashtra is manufacturing the medical refrigerators since it is a product under essential category.

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Is capacity taken care of?

This year, both product availability and capacity is taken care of. The situation is now like last year when there was a nationwide lockdown.

Even though Maharashtra sales is shut for the next few days due to the restrictions, rest of India is open. This means that for us 85 percent of potential market is open for sale.

Do you see a demand spike in 2021?

We are expecting a spike in demand. We are seeing that the demand of products in the cooling category is higher then April 2019 as per our estimates. This is despite Maharashtra being closed.

One of the reasons for this is the extended work-from-home for professionals and they want a comfortable environment at home.

Is there any fear of sales impact due to the second wave of COVID-19?

In India, appliances have moved from the discretionary category to essential category. Be it refrigerators, washing machines or air conditioners, they are required across homes.

A surge in COVID-19 and any restrictions may lead to temporary drops in sales, but the overall demand is intact. We saw that in Q3FY21 as well where there was a 35-40 percent sales growth.
M Saraswathy is a business journalist with 10 years of reporting experience. Based in Mumbai, she covers consumer durables, insurance, education and human resources beat for Moneycontrol.
first published: Apr 15, 2021 05:29 pm

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