The consumers would feel the burden of increased prices only from December as the retailers' focus would be to clear out the Diwali stocks first.
If you were planning to save some money on purchase of home appliances like air conditioner and refrigerators in off season, then you might want to think twice.
Prices of electronic consumer durables like refrigerators and washing machines are expected to go up by 3-5 percent in November, the Economic Times reported.
However, citing sources the newspaper said that the consumers would feel the burden of increased prices only from December as the retailers' focus would be to clear out the Diwali stocks first.
The input cost of consumer goods had gone up by 30-50% since the last price hike, which impacted the industry earlier this year in January.
The price of steel has since increased by 40% and that of copper by 50%. The report also mentioned that a relevant chemical called MDI, which is used to make foams mostly for refrigerators, is also facing a global shortage and its price has been doubled.
"These three account for almost 70% of input cost and hence there is a net impact of 5-6% on prices. However, we will absorb some and pass on the rest, that too probably in phases, since market sentiments are not very buoyant," Godrej Appliances business head Kamal Nandi told ET.
Nandi said that his company will raise prices of refrigerators first, then washing machines and AC prices will be the last to get revised.
Meanwhile, to consumers' relief eating out in AC restaurants might become cheaper as a GST ministerial panel has suggested slashing down tax rate to 1% for small businesses and AC restaurants.
At present, manufacturers and restaurants with turnover up to Rs 1 crore pay GST under composition scheme at 2% and 5% respectively.
The Group of Ministers met second time on Sunday. The panel was headed by Assam Finance Minister Himanta Biswa Sarma also suggested doing away with the tax rate distinction between AC and non-AC restaurants, those which are not covered under composition scheme, and tax them at 12% with input credit.
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