The air conditioning industry in India, currently valued at around Rs 27,500 crore ($3.3 billion), is expected to double in the next four years, according to Blue Star’s annual report. Blue Star Chairman & Managing Director Vir S. Advani highlighted that the Indian HVAC&R (heating, ventilating, air conditioning, and refrigerating) sector is poised for exponential growth.
This anticipated growth is driven by factors such as the low penetration of room air conditioners and the growing middle-class population with high disposable incomes, particularly in smaller Tier III, IV, and V markets. The overall AC industry, encompassing both residential and commercial segments, is expected to double its current valuation of Rs 27,500 crore in the next four years, Advani noted in his address to shareholders in the company’s 2023-24 annual report.
Blue Star is optimistic about its future business prospects due to changing weather patterns resulting in hotter summers and the introduction of a new and resilient product portfolio for residential and commercial air-conditioning. The company has implemented a 3-year strategic plan to enhance its core capabilities, acquire new competencies, build new processes, and adopt innovative technologies, Advani added.
The plan includes specific investment details to support these growth initiatives. In FY25, Blue Star will focus on growing faster than the market, improving margins through a comprehensive Total Cost Management program, prudent financial capital management, leadership development, and succession planning.
Blue Star believes that its strong consumer insights into the domestic market, extensive network of channel partners across 900 towns, and strong brand equity will position it well to leverage upcoming opportunities. This will require substantial investments in sales and distribution, R&D, manufacturing, supply chain, and digitalization.
In FY24, Blue Star achieved a revenue growth of 21.4 percent, reaching Rs 9,685.36 crore. The company, which has completed 80 years, also improved its market share in the room air-conditioner (RAC) segment, estimated at 13.75 percent compared to 13.50 percent in FY23.
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