Blue Star, a leading air conditioning and commercial refrigeration company, expects to close the current fiscal with sales volumes reaching 1.5 million units, a sharp increase from 1 million units in FY24. The company plans to maintain a ₹200 crore capital expenditure in FY26, focusing on expanding capacity at its Sri City factory while investing in R&D, digitalisation, and marketing to support growth.
Despite challenges, Blue Star reported around 35 per cent growth in Q2 and Q3. “As we enter Q4, the market remains strong, marking an unprecedented year for the air conditioner industry. With a promising summer ahead, the room AC market is expected to record 20-25 per cent growth,” said B Thiagarajan, Managing Director of Blue Star Ltd, at the launch of the company’s new range of room ACs.
Last summer, Blue Star’s market share declined from 13.75 per cent to 13.5 per cent due to supply constraints. However, the company regained ground in Q2 and Q3 and expects further gains in Q4. By the end of this fiscal, it aims to reach a market share of 13.8 per cent and 14.25 per cent in FY26. While the original target of 15 per cent by 2025 has been pushed to FY27, the company remains committed to steady growth, Thiagarajan added.
In terms of capital expenditure, Blue Star invested ₹200 crore last year and has earmarked another ₹200 crore this year for capacity expansion, excluding backward integration projects. The Sri City facility, currently operating at full capacity with 650,000 units, will scale up to 825,000 units next year and reach 1.2 million units by FY27. Meanwhile, its Himachal plant has reached its maximum capacity of 650,000 units.
Thiagarajan highlighted the company’s commitment to R&D, allocating ₹32 crore this year with a projected investment of ₹51 crore next year. Additionally, Chairman Emeritus has contributed ₹100 crore, to be fully utilised within three years. To enhance digitalisation and technology integration, Blue Star has set aside ₹20 crore.
On the branding front, Virat Kohli continues as the brand ambassador. The company’s ad spend will increase from ₹50 crore last year to ₹65 crore this year, with ₹40–45 crore allocated for the summer alone.
For the upcoming summer, Blue Star has introduced a comprehensive range of 3-star and 5-star air conditioners designed for high cooling performance under extreme conditions. Available in capacities from 0.8 TR to 4 TR, the models start at ₹28,990.
Ssmart-ready
All newly launched inverter AC models over the past three years have been smart-ready, allowing customers to upgrade to smart features by installing a ₹3,000 smart module. Those opting for a Wi-Fi-enabled AC upfront pay just ₹990 more than a regular AC, making it a cost-effective choice.
“This pricing strategy has driven significant growth. Sales began with 2,000 units two years ago, surged to 85,000–90,000 units last year, and with smart features now standardized across 40 models, we aim to sell 5 lakh units this year,” said C Haridas, Executive Vice President, Sales & Marketing and Customer Service, CPAG & CRBG, Blue Star.