PL Sector Update - Consumer Durables - Fan Channel Check update (June-2023)

Consumer Durables - Praveen Sahay - Research Analyst, Prabhudas Lilladher Pvt LtdPrabhudas Lilladher Pvt Ltd

Fan Channel Check update (June-2023)

We have visit Lohar Chawl, wholesale market for electronics and electrical goods in Mumbai, and interacted with 10 fans dealers/retailers (Havells, Bajaj, Crompton, Orient, Atomberg, Standard) to gauge demand scenario of fan in summer season. As per our interaction, the demand for Fan have gone up starting from mid-May while there is no price action or discounts. Below key takeaways:-

Price stable post hike in Feb-Mar’23

The channel suggests that there is no price hike since April in fans segment owing to tough competition, post recent price hike in Feb-Mar’23.

Demand (Positive MoM)

Sales have picked up from mid-May’23 with summers and heat waves around.

Fan Inventory normalised (Positive MoM)

Our channel checks suggest, there is a reduction in channel inventory on m-o-m basis, with the summer season. Channel inventory on an average of 30 days at dealers’ level. The non-star rated fans inventory has almost cleared off and few of them are being sold at 5-7% discount. With the increased temperature and harsh summer, we believe volume growth is not a challenge in coming days, early rains may be damper in demand.

Most selling fans

Bajaj/Havells fans are most selling in the affordable/premium range with Bajaj fans @Rs1750 and Havells fans@Rs4000. For energy saving and remote controlled fans, Atomberg fans are preferred.

Other highlights

Major volume at dealer level coming from simple fans against designer fans. All the fans have a 2-year warranty period and Polycab fans have a 3-year warranty period.

Exhibit 1: Channel Check Summary