According to Veer S Advani, MD, Blue Star Limited and Chairman, Confederation of Indian Industry (CII) Western Region, air conditioner prices are going to increase further in the coming months. The reason for this is the huge increase in the input cost of things like copper, aluminum and steel and the new energy efficiency rules implemented in January 2026. Speaking during the CII-BFSI Summit 2026, Advani said that there has been a never-before-seen increase in input costs in the manufacturing sector. He said that the cost everywhere in our sector has increased by about 14 to 16 percent, which has never happened before. The last time such cost increase took place was in 2011.
Why will ACs be expensive?
He said that the total cost of the product is increasing due to the combined effect of rising prices of raw materials and changed energy efficiency standards. He explained that there was a change in the energy table on January 1, 2026. Therefore, most of the sales in the market in January, February and March were what we call ‘old BE table products’, which are less efficient and hence cheaper. Advani indicated that prices are unlikely to come down in the coming times.
He said that unfortunately, that will not happen. As these increased costs enter the supply chain, costs will actually increase further over the next few months. He further said that companies are trying to reduce this impact through value engineering and cost reduction methods. He further said that the industry may have to face inflationary pressure for the next 12 to 18 months. In such a situation, as the market adapts to the changes in prices, both manufacturers and customers will have to gradually adjust to it.
Real estate is keeping the economy strong
Talking about real estate and the Banking, Financial Services and Insurance (BFSI) sector, Advani stressed on the growing synergy between the two and said this will be vital for future growth. He further said that India’s real estate sector is now becoming an important destination for institutional capital. He said that India’s real estate sector has now become an important source for institutional capital.
The main reasons for this are strong investor confidence, reforms and the increasing role of REITs. To sustain this momentum and increase investment across segments and cities, continued policy support, clarity in regulations and better coordination between industry and financial institutions will be essential. He further said that real estate and BFSI together create a strong growth engine for the economy. Advani said that real estate and BFSI together form a powerful engine of India’s growth.
