Whalesbook
AC Prices to Surge in India
Room air conditioner prices in India are poised for a significant jump, with industry-wide hikes of 7-8% anticipated from January 2026. This upward adjustment is primarily driven by the implementation of new energy efficiency star rating norms and sustained commodity inflation, according to a report by Equirus.
New Norms Drive Costs
The forthcoming star-rating regime, effective January 2026, mandates stricter energy efficiency standards. This necessitates manufacturers adopting new technologies and designs, contributing to increased production costs. Coupled with ongoing rises in raw material prices, such as copper and aluminum, the industry faces pressure to pass these expenses onto consumers.
Pre-Buying Activity Surges
Anticipating the price escalations, dealers and consumers are already engaging in strong pre-buying activity. Reports indicate a rush to purchase existing models in December as channel partners and buyers stock up on current inventory before the new norms take effect and prices inevitably climb. This trend is expected to boost sales in the short term.
Market Outlook Positive Despite Price Hikes
After a volatile past two years, the Indian Room Air Conditioner (RAC) industry is looking towards calendar year 2026 with optimism. Analysts project a substantial volume growth of 20-22%, recovering from a challenging CY2025. This recovery is expected to be fueled by a favorable base effect, pent-up demand, and a return to normalized summer season patterns.