Blue Star eyes jump in water-purifier sales.

Air conditioning major Blue Star has chalked out a multi-pronged strategy to achieve a quantum leap in sales and market share in its water purifier business this fiscal.

The company expects its plan of almost doubling the distribution network, ramping up service franchises, integration of water purifiers’ sales and service functions with that of air conditioners, strong momentum on the e-commerce platform, and significant advertising spend to help the company achieve significant sales and share.

B Thiagarajan, MD, Blue Star, said the company had made significant progress in its water purifier business since its foray in October 2016.

“The building blocks are already in place, and we hope to achieve sales volume of 120,000-125,000 units in this fiscal alone and revenue of Rs. 120 crore (as against Rs. 70 crore in FY18),” he said. “We have opened a new factory at Wada (Maharashtra), creating job opportunities for 450 people,” he added.

The scale-up target this fiscal is pretty steep when compared with the cumulative volumes of 70,000-plus units it sold in the past 18 months.

The electric residential water purifier market in the country is pegged at about Rs. 5,000 crore, growing at a CAGR of 8-9 per cent. Replacement market accounts for about 15-20 per cent of the market.

Blue Star presently offers 34 models across nine series in the price range between Rs. 7,900-46,900 for the residential segment. It plans to introduce three more variants in the price range of Rs. 19,000-25,000 by September.

It is now getting ready to enter the commercial water purifiers market, targeting offices, restaurants, clinics and other commercial establishments. A range of products for this segment is to hit the market in the next three months.

The company presently sells its water purifiers in 138 towns through 2,800 outlets, including 200 exclusive stores. It is planning to increase the presence to 5,000 outlets during the current year by penetrating into Tier -II, -III, and -IV locations as well as by leveraging company’s existing air conditioners network.

“To support our growth plans, we plan to spend about Rs. 30 crore on advertising and sales promotion of our water purifiers,” said Thiagarajan.

He also indicated that water purifier sales on the e-commerce platform was gaining momentum across the industry, and Blue Star had garnered about 20 per cent of its sales on the platform as against the industry average of 10 per cent.

HBL