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Rationalised duties, promo offers pull down prices(Indian Express Via Thomson Dialog NewsEdge) It's good news for Indian consumers planning to buy home appliances this Diwali. Low prices and sleek new models are set to entice shoppers this season, as manufacturers have made highest-ever sales targets to cash in on the lifestyle-led boom. Industry officials say this season prices are down by 5-8 per cent across products over last year mainly due to the rationalised duty structure and manufacturers' initiatives to support new products. "Prices are down by almost a third for high-end products like plasma and liquid crystal display (LCD) televisions," says Girish Rao, vice-president, LG Electronics. "For rest of the product segments, prices did not go up despite input costs going up this May," he adds. With the ownership of high value durable goods like LCD, plasma TVs and front-loading washing machines now being seen as a source of social status, especially among urban households, manufacturers are bullish on sales targets. Samsung has jacked up its sales target by 37 per cent to Rs 860 crore for the festival season. Rival LG is targeting an overall growth of 20 per cent at Rs 2,500 crore. Last year, LG set a target of Rs 1,600 crore and ended up with a Rs 2,100 crore kitty. Videocon has launched a nationwide marketing drive to push its sales by a quarter over last year. The company is planning to offer benefits worth Rs 100 crore to its customers in terms of free gifts with its products. "We are expecting a 35 per cent jump in sales at Rs 2,800 crore," says Videocon's joint president (sales & marketing), Sunil Mehta. "Prices have come down in high value items but an increase in input costs is eating into our margins in low-cost products," he says. With customers replacing their older products with new ones, company officials say the future of high value products like liquid crystal display TVs is buoyant. In order to penetrate deep into the high-end market, LG launched smaller sized liquid crystal display (LCD) televisions. "Prices of LCDs and plasma TVs are substantially lower... an LCD costing Rs 1.5 lakh last year now costs about Rs 1 lakh," says Rao. Based on recent trends, the Indian CTV market would increase to 10.5 million units during the current fiscal while the refrigerator market would touch 4.2 million. Of this, each company is targeting to sell 25,000 units each of high-end LCDs and plasma TVs, which cost in the range of Rs 35,000 to Rs 7 lakh, in the next one month. Weak sales in the eastern parts of the country, however, have come as a dampener for the industry. "We are hoping sales would pick up in Eastern region as customers did not come out to shop as expected due to heavy rains," says Rao. The festival season is the key to the Rs 20,000 crore Indian consumer durable industry. All companies target this season with various offers and finance scheme as salaried employees get their annual bonuses and go on a buying spree. Cashing in on the festival boom Consumer durable prices down 5-8% LCDs, plasma costs fall one-third Industry sales target up by a quarter Weak eastern India sales a dampener Copyright 2006 The Indian Express Online Media Ltd.. Source: Financial Times Information Limited. |