Blue Star flags 200 bps margin hit despite AC industry's 50% May surge
MD B. Thiagarajan says India's AC industry likely grew over 50% in May on summer demand, with Blue Star's secondary sales up 30% in April-May. But rising input and fuel costs need a 13% price hike; only 8% passed through, leaving ~200 bps margin compression this quarter. Commercial refrigeration up 15%.
What happened
Blue Star MD says India's AC industry likely grew over 50% in May on strong summer demand, but rising input costs, fuel prices and weak consumer sentiment will
Key facts
- 50% AC industry growth in May
- 30% April-May secondary sales growth
- 13% price increase needed, 8% passed on
- 10% further price hike required
- 200 bps margin decline expected
- 50% domestic compressor sourcing
- 15% commercial refrigeration growth
- ₹32,557 crore market cap
Why this matters
The input-cost squeeze on mid-tier durables players opens a window to scout bolt-on commercial refrigeration or component-supply targets whose margin distress makes them receptive to strategic conversations.