LG Electronics India vice-president (sales) Girish V. Rao (left) with Amitabh Tiwari, business head (consumer electronics), in Calcutta on Wednesday. Picture by Kishor Roy Chowdhury

Calcutta, May 10: LG Electronics India Pvt Ltd is set to increase the prices of refrigerators, air-conditioners and microwave ovens by 5-10 per cent from June. Its bottomline has been hit hard by the recent spurt in raw material costs, including plastics and metals such as steel, copper and zinc.

“If the metal and plastic prices continue to rise, we may have to increase our product prices by 5-10 per cent. A situation has arrived where we can no longer absorb any rise in input costs. However, we will not raise the prices till June,” said Girish V. Rao, vice-president (sales), LG Electronics India Pvt Ltd.

Amitabh Tiwari, business head (consumer electronics), said, “March to June is the season when sales of refrigerators and air-conditioners peak. We are in the midst of the season and we don’t want to tamper the demand with product prices.”

All consumer electronic goods manufacturers in the country, including LG, are feeling the heat of high input costs.

“While a couple of manufacturers have already increased prices of few items, others have resorted to reducing dealers’ discounts to absorb the cost increase,” Tiwari said.

“The input cost for refrigerators has gone up by more than Rs 450 per unit and for air-conditioners by Rs 350 per unit. The hike is, however, only Rs 36 on TVs. As of now, we can absorb the increase in input costs for TVs. But for refrigerators and air-conditioners, the margins have become really thin,” he added.

LG has already increased the prices of its direct cool refrigerators by 2 per cent this year.

The company today launched five colour TV models in the city. The new range of flat panel and LCD TVs is priced between Rs 12,790 and Rs 70,000. “We may increase our TV prices after Diwali,” Tiwari said.

LG will expand its manufacturing facility in Pune at an investment of Rs 20 crore this year. “It will become our export hub,” Rao said.