The Telegraph
Monday , January 13 , 2014
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Blue Star stress on room ACs

Thiagarajan: Aiming big

Calcutta, Jan. 12: Blue Star Ltd, an air conditioning and commercial refrigeration company, is eyeing a 25 per cent growth in the room AC segment in 2014.

The market for room air conditioners is expected to grow around 15 per cent by fiscal 2015.

In 2013, the room air conditioners market in India grew 9 per cent, while Blue Star was able to achieve 18 per cent selling 2.5 lakh units against an overall market size of 35 lakh. The company aims to achieve sales of 3 lakh units in 2014 against an expected market size of 39 lakh.

Room ACs cater to residential as well as the corporate and commercial segments such as offices, restaurants, showrooms and ATMs. Blue Star is expecting a strong growth from the residential segment, which leads their retail sales.

Blue Star will look to double the contribution of energy efficient inverter ACs to 6 per cent of the total AC sales in the current year.

“By 2020, the AC market in India is expected to be 10 million units. But the industry is moving slowly. The growth is dependent on the overall growth of the economy. The penetration of air conditioners in the country is only 3 per cent when we need at least 10 per cent. In China, it is close to 35 per cent,” said B. Thiagarajan, executive director and president — AC&R products business, Blue Star.

“We will continue to grow the market for inverter ACs. We have invested Rs 75 crore in the past three years in research and development,” Thiagarajan said.

The company plans to expand its dealer network by adding 500 more outlets during the year to the existing 2,500. Around 50 per cent of the company’s sales are from smaller towns.

Blue Star’s product portfolio for room AC comprises 60 models, all adhering to the new energy standards prescribed by the Bureau of Energy Efficiency.

The company is also looking to set up a manufacturing unit in Tamil Nadu or Karnataka. “We have seven manufacturing units and we will need a facility by December 2015. Investments could be around Rs 150 crore,” Thiagarajan said.