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The consumer durable industry is navigating a challenging period where top-line growth is likely to be offset by thinning margins and regulatory shifts. Q4FY26 is expected to be a soft quarter for the sector, due to modest demand and rising input costs, noted a report by Centrum.
The report estimated that the sector will see a 9 per cent year-on-year sales growth, reaching Rs 480 billion for the quarter. "For Q4FY26, we expect our coverage universe to see 9% YoY sales growth at Rs 480 bn while EBITDA margin is likely to fall 130 bps YoY to 9.5%, leading to 6% YoY de-growth in PAT at Rs 31 bn," the report stated. On the margin front, the sector is likely to see "elevated pricing pressure due to rising commodity costs, specifically in copper, aluminium, PVC, and resins." These pressures are further compounded by the depreciation of the rupee and logistical hurdles such as higher ocean freight and increased competition from imports. Additionally, the report mentioned that categories like air conditioners, fans, and refrigerators are facing specific headwinds following regulatory changes. "Categories which has seen BEE norm changes (AC, Fan, Refrigerator, etc.) from 1st Jan 2026 would see additional pricing pressure despite taking price hikes," the report noted. The Cable and Wire category, which previously delivered strong volume growth, has also seen a moderation to low single-digit volumes. While realization growth in this segment remains in the mid-teens due to higher copper and aluminium prices, the overall volume slowdown in February and March 2026 was driven by channel de-stocking and the deferment of various projects. "On margin front, the sector is likely to see elevated pricing pressure due to rising commodity costs (copper, aluminium, PVC, resins), rupee depreciation and increased challenges like imports and higher ocean freight," the report added. While premiumization continues to drive early double-digit growth in washing machines and televisions, the broader industry remains cautious. The report stated, "Another round of price hikes are expected in April month to offset rise in PVC, resins prices and rupee depreciation." (ANI)
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