It's raining discounts on consumer durables this Independence Day as inventory piles up

Consumers shopping over the extended August 15 weekend can expect deeper discounts on air conditioners, refrigerators, and fans, as brands and dealers work to clear unusually high inventory levels after a weak summer cooled demand.

This year’s early and widespread monsoon showers kept June, typically a high-volume month, cooler than expected, hurting sales of cooling appliances. Dealers say footfall dropped sharply, leaving shelves stacked and restocking plans on hold.

“In key categories such as air conditioners, sales dropped by nearly 35–40% across all major brands,” said Sorabh Nahata, partner at Mangalore-based Canara Electric & Refrigeration Co. “We’re holding almost 1.5–2 times the usual stock for this time of year, and our inventory turnover has stretched from 45–60 days to nearly 90–100 days. This has strained working capital, so we’re offering discounts, free installation, extended warranties, and multiple finance options to move goods before the festive rush.”

The subdued summer has also dented manufacturers’ earnings. Blue Star’s Q1FY26 net profit fell 37.7% sequentially to ₹120.82 crore from ₹194 crore in Q4FY25, with revenue down 25.8% to ₹2,982.25 crore. The company blamed “unseasonal rains across the country resulting in a weak summer,” which hit its room air conditioners business hard, though its B2B segments – electro-mechanical projects, commercial air conditioning, and refrigeration – helped offset some of the impact.

Voltas saw one of the steepest drops, with Q1 net profit plunging nearly 58% year-on-year to ₹140 crore from ₹334 crore. Revenue fell 20% to ₹3,939 crore from last year’s high base, when a prolonged summer had driven record sales.

Anand Ramanathan, partner and consumer products & retail sector leader at Deloitte India, said that after last year’s record-breaking heatwave triggered a surge in sales of air conditioners, refrigerators, and fans, manufacturers ramped up production and stocked aggressively in anticipation of similar conditions this year.

The mismatch between expected and actual demand has “led to extended discounting and delayed restocking plans” across the industry.

“The over-preparedness based on last year’s exceptional performance has exposed the risks of weather-dependent forecasting, especially in a market where consumer behaviour is evolving rapidly,” he said

The glut traces back to last year’s record-breaking heatwave, which spurred a surge in cooling appliance sales. Expecting similar demand in 2025, manufacturers ramped up production and dealers stocked heavily.

According to Deloitte’s report on FMCG, retail, and e-commerce, premium refrigerators grew 22% year-on-year, while basic models declined 6%, reflect a tilt toward higher-end products. Even so, the shorter summer weighed on overall volumes.

“This year during summer months the cooling appliances witnessed a degrowth industry-wide largely due to unseasonal showers,” said Kamal Nandi, business Head & EVP, Appliances Business at Godrej Enterprises Group. “At Godrej, we continued to grow across categories through brand building, network outreach, and smart promotions. The premium segment saw more traction, but we expect rural demand and higher disposable incomes to drive growth beyond premium in the coming months.”

With the festive season kicking off in August in Kerala with Onam, brands are front-loading offers. Godrej’s ‘Golden Onam’ scheme includes cashback up to ₹12,000, extended warranties of up to five years, and easy EMIs. Dealers across the country are following suit, banking on long weekends and early festival shopping to pare down excess stock.

While the short summer has highlighted the risks of weather-dependent forecasting, Deloitte projects the consumer durables market to grow from $67 billion to $100 billion by FY 2030, supported by rising incomes, urbanisation, and the spread of energy-efficient appliances.