KOLKATA,March16,2012: Prices of consumer electronics like LCD TV, LED TV, air-conditioners, refrigerators, washing machine and microwave ovens are going to go up by 2-4%, posing a major headache for white goods companies who are fighting a slowdown in demand for the last one year.The Budget on Friday increased excise duty by 2% from 10% to 12%. Accordingly, a 1.5 tonne 3-star split AC will now cost Rs 1,000 more, while a 240-litre 5-star frost-free refrigerator will cost Rs 800 more. A 6kg fully-automatic front-loading washing machine will cost Rs 1,200 more.The other announcement - exemption of basic custom duty for LCD and LED TV panels, will have little impact since there was already nil custom duty for imports from Japan and Korea from where major companies like LG, Samsung, Panasonic and Videocon primarily source their TV panels.TV makers indicated LCD and LED TV prices will also go up by 2-3%. As a result, a 32-inch LCD TV price will go up by Rs 800 while that of a 32-inch LED TV by around Rs 1,200.
"The signals are not good considering consumer demand has already been low due to recurrent price hikes on account of commodity inflation and other macro-economic conditions," said Panasonic India managing director Manish Sharma."Demand will get dampened and we expect the industry growth may again take a hit this year," said Samsung India deputy MD Ravinder Zutshi.The Rs 38,000 crore durable industry growth rate more than halved to 6% last calendar from 13% in 2010. The industry feels growth rate may take a hit by 10-15% this year.Industry veteran and MD of Akai India Pranay Dhabhai says the price hike will be more than 2% of the excise duty increase. "We have to consider the increase in channel margins and the VAT payout due to increase in the ex-factory price," he said.
"The signals are not good considering consumer demand has already been low due to recurrent price hikes on account of commodity inflation and other macro-economic conditions," said Panasonic India managing director Manish Sharma."Demand will get dampened and we expect the industry growth may again take a hit this year," said Samsung India deputy MD Ravinder Zutshi.The Rs 38,000 crore durable industry growth rate more than halved to 6% last calendar from 13% in 2010. The industry feels growth rate may take a hit by 10-15% this year.Industry veteran and MD of Akai India Pranay Dhabhai says the price hike will be more than 2% of the excise duty increase. "We have to consider the increase in channel margins and the VAT payout due to increase in the ex-factory price," he said.