Consumer Durables Emerge Out Of GST Pressure, Motilal Oswal Says

Restocking of consumer durable products picked up in August following Goods and Services Tax (GST)-led slowdown in the previous month, Motilal Oswal said in a report.

Restocking for washing machines, refrigerators and LED TVs has led to inventory normalisation, but with the peak summer behind, air conditioners and air coolers segment would see meaningful restocking only in September, the brokerage added.

Here’s what Motilal Oswal said on various segments:

Air Conditioners Segment

• The brokerage maintained that the segment did not introduce price hikes post GST implementation, but they might come through before September.
• Among the brands, unanticipated surge in demand led LG Electronics to run out of stock, benefitting peers Daikin Industries Ltd. and Panasonic Corporation.
• Voltas, however, still has a lower share in the inverter AC section.

Air Coolers Segment

• The brokerage said that Symphony Ltd. remains the highest selling brand in air coolers, followed by Bajaj and Orient
• Kenstar does not sell very well at large retail format stores and primarily competes on price and is a discounted brand

Washing Machines Segment

• The front load segment is dominated by LG, Siemens Ltd. and IFB, while top load is dominated by LG, Samsung and Whirlpool
• Price wise, Godrej Consumer Products Ltd. is cheapest, followed by Whirlpool and LG or Samsung