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Kitchen switchover: Cylinder cap to boost sales of modern appliances

Source : IANS
Last Updated: Tue, Oct 02, 2012 08:40 hrs

Kolkata, Oct 2 (IANS) The union government's decision to cap the number of subsidised cooking gas cylinders per household is likely to push a switchover in kitchens to alternate appliances like induction cookers and microwave ovens, industry experts say.

They say that with increased urbanisation and the rising number of working women, consumers have already been looking for alternate ways of cooking and for more modern cooking appliances. The government's move will accelerate the trend.

While the government, in its desperation to bring down its soaring subsidy bill, is facing flak from several quarters for indirectly raising cooking gas prices, applaince makers are giving the ruling dispensation a thumbs up.

Manufacturers in the country's Rs.1,100-crore induction cooker market are of the view that the government's decision is likely to boost sales. They expect that more households would now opt for an induction cooker as a substitute to the gas stove as this is a cheaper alternative to non-subsidised LPG cylinders.

The central government has decided to limit the number of subsidised cylinders to six per household per year. Some states have said they would raise this.

Bajaj Electricals, the number two player in the induction cooker segment, is confident of clocking a 50 percent year-on-year growth in the segment in this financial year, riding on the reduction in the subsidy on cooking gas.

"Induction cookers will simply become wow. So we have decided to build up stocks immediately," Bajaj Electricals Ltd chairman and managing director Shekhar Bajaj told IANS.

"Households using gas stoves are expected to think of going for induction cookers as the electricity cost for these cookers would be nearly half the price of the non-subsidised LPG cylinders," Bajaj added.

According to him, even if power tariff is hiked by 20 to 30 percent, using induction cookers would still be cost effective.

The company, which garnered a turnover of Rs.100 crore from the segment last fiscal, is expecting to register a revenue of Rs.150 crore this fiscal.

Philips, another major player in home appliances, said the government move will fuel growth in categories such as induction cookers, rice cookers and airfryers.

An airfryer makes it possible to cook a vast array of dishes using just air.

"We launched our induction cookers this year and are seeing strong growth in this category this year," said Genevieve Tearle, marketing director (Domestic Appliances and Coffee India), Philips Electronics India Ltd.

"Our Induction cooktops have had a good response from the market and given that such products fit into the changing lifestyle of today's modern homes, we have every reason to believe that this category will continue to grow as strongly as it has in the past," Tearle observed.

According to her, women are looking for alternatives to gas and for more modern cooking appliances.

"This inspired us not only to introduce new induction cooktops with Indian menus but also to launch truly innovative products such as airfryer, which cooks food with up to 80 percent less oil than frying and is significantly faster than using a convection oven. The market is showing great potential, especially among young customers and nuclear families for such innovative cooking appliances which also bring real benefits to their kitchens," Tearle pointed out.

Philips also expects good growth in rice cookers.

Some leading electronic majors believe that the centre's move might also indirectly boost microwave oven sales.

"People will certainly look for cheaper options and alternate ways of cooking. So, it might indirectly help microwave sales growth," a Samsung Eletronics spokesperson said.

As of now, microwave penetration is extremely low in India as market size is approximately around 1.5 million units in the country.

(Mithun Dasgupta can be contacted at mithun.d@ians.in)



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