Blue Star Sees Early Signs Of Recovery In AC Sales After A Tough Year
Blue Star Managing Director B Thiagarajan said the air-conditioner maker is seeing early signs of a pickup after what he described as a ‘bad year’ for the cooling industry, though he cautioned that the second half recovery will not fully offset the summer-season slowdown.
According to Thiagarajan, Blue Star stock price has been affected by the tough year, but the company is looking forward to a better performance in the next year. He also mentioned that the Indian stock market news has been positive, with the Nifty and Sensex showing signs of recovery.
Second Half Recovery
Thiagarajan said that the second half of the year is likely to be better than the first half, but it is not going to make up for the huge slowdown in demand during the summer season or during the GST blackout period. He also mentioned that the company is seeing improving traction from the festive period onward, with a huge spike in sales from September 22nd till Diwali, and good sales in November and December.
The New Year sale starting on December 15 and the Republic Day promotions running up to January 26 are also expected to boost sales, with dealers being optimistic about the upcoming quarter. Thiagarajan said that the company is not disheartened by the disappointing year and is looking forward to a better performance in the next year.
Outlook For The Next Cycle
Thiagarajan argued that investors should look beyond base effects and consider the two-year average to get the right picture. He is hoping that the summer will be strong because the fundamentals have not changed, with low category penetration, stable pricing, and localization being structural drivers that will help the market hold up well in calendar year 2026.
He also mentioned that the company is weatherproofing its business through its commercial and project businesses, which have been challenging in 2025, but have pockets of strength such as factories and data centers, where Blue Star is a market leader.
Energy Label Transition
A key near-term variable is the energy label transition from January 1, 2026, which will make the January-March quarter an execution-heavy quarter. Thiagarajan said that the company will have to manage its inventory and manufacturing very judiciously to meet the new energy label requirements, which will push up costs by 7-8%.
However, the company has begun making new-label products from November and is expecting to clear older inventory through attractive prices and schemes during the festive-to-Republic Day window. Thiagarajan said that the company is well-prepared for the energy label transition and is confident of meeting the new requirements.
Conclusion
In conclusion, Blue Star is seeing early signs of recovery in AC sales after a tough year, with improving traction from the festive period onward. The company is looking forward to a better performance in the next year, with a strong summer expected due to structural drivers such as low category penetration, stable pricing, and localization.
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