Godrej Appliances has almost reached its pre-COVID sales level this month, and it expects to attain full manufacturing capacity utilisation by end of September this year, said a top company official. The company is expecting to attain its peak capacity by September, just before the festive season starts as the sales are gradually increasing due to various factors, including opening of markets with reduced restrictions and pent up demand.
However, the company also expects degrowth for the industry due to lost sales of April and Half of May, which account almost one third sales of the cooling products.
“We should be operating at by around 100 per cent manufacturing capacity by September, before festive sales,” said Godrej Appliance Business Head and Executive Vice President Kamal Nandi.
The Godrej Group firm has manufacturing units at Sirwal, Pune and Mohali in Punjab. It has a peak manufacturing capacity of around 2.9 lakh units of refrigerator.
“Initially, we have to keep our plants closed because of lockdown scenario. Then we started opening of both of plants in the month of May but the demand was not enough as there was enough stock available at dealers warehouses and our warehouses, so we need not produce enough in May and produced only 20 percent capacity,” said Nandi.
According to him, the production started picking up in June. Presently, its 95 percent of outlets are operating.
“We are operating our plants at 60 percent plus now. We are intending to have 80 percent utilisation in July and then onwards enhancing further,” Nandi said, adding that these are the “projections based on the current trend”.
While talking on sales, Nandi said that in the last week, the company has almost attained the same numbers as the corresponding period last year.
“As we are in the last week of June, we have seen sale and demand almost equal to last year of June in the last week. We have reached to the demand level of the last year in the fag end of June. I expect this to continue in July also,” he said.
“When we started in June it was around 70 percent of last year, in the mid of June it was 85 percent and last week it was almost at the level of last year." This has been witnessed by the company in all the segments, which it operates including refrigerators, washing machine, air condition etc.
“The demand of AC is going down because we are now entering into monsoon and demand of refrigerators and washing machine is going up,” he said.
However, Nandi also added that the company has lost its sales completely in April and May, which accounts for almost one-third sales of the cooling products due to the lockdown.
“There will be an impact on the financials and overall there will degrowth as April is a peak month (for sales of cooling products) and May (half-closed) is also a big month for the industry and us too,” he said.
On increasing indigenisation of products, Nandi said that Godrej Appliance was a pioneer in that whether it is for the technology of refrigerators or washing machine and has established it as a “preferred strong Indian brand” in the segment.
“Our efforts in this direction would continue,” he said, adding that Godrej Appliances, as a company, has been investing to increase the manufacturing base in the country.
This has been done by across the brand in India and presently except microwave ovens, everything is now manufactured in the country.
“More than 95 percent product, which we sell in the country is produced in the country and the same is with case with Godrej Appliances,” said Nandi, who is also the President of Consumer Electronics and Appliances Manufacturers Association (CEAMA) also.
Last week, the company has extended its offerings by introducing a new ingenious refrigerator ranges - Godrej Edge Rio and Godrej Edge Neo and new age semi-automatic washing machine Godrej Edge Ultima.
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