Blue Star bets big on smart ACs, eyes 5 lakh unit sales & 25-30% growth

Blue Star has unveiled 150 new models of room ACs, including its flagship premium range for the upcoming season. There are inverter, fixed-speed, and window ACs in the line-up, so it can meet the needs of all types of customers at all price points.

During this summer, the company expects its AC sales to grow 25-30%, despite last year’s high base, when the market expanded nearly 60%. The company that makes cooling products is sure that it will sell about 1.75 million room air conditioners in FY26. This will be possible because summer came early, income is rising, and some forecasts say the season will be harsh.

Focus on smart ACs and high-performance cooling

Speaking to afaqs!, Girish Hingorani, vice president - marketing (consumer products) & corporate communications at Blue Star, revealed that the company is heavily focusing on smart technology. While the company offers a range of 150 models across price points, its primary goal is to drive consumer upgrades to technologically advanced products.

"Consumers are now looking for value-added features. We are launching 40 new smart AC models this year, offering enhanced convenience like remote access via mobile apps, temperature control, usage monitoring, and customised sleep settings," Hingorani said.

The company has seen exponential growth in the smart AC segment. In 2022, it sold 3,000 smart ACs. This figure increased to 70,000 in 2023. This year, the company is aiming to sell 500,000 (5 lakh) smart ACs, accounting for nearly 30% of total sales. 
The ambitious growth is projected on the back of standardising 5-star rated ACs and reducing the price gap between regular ACs and smart ACs to only around Rs 1,000.

Hingorani noted that a key trend this year is the rising demand for high-performance ACs. Extreme summer temperatures last year showed how weak regular air conditioners are, which made people look for stronger options, especially in the North.

"Ordinary ACs struggle to perform in extreme heat. Our new heavy-duty ACs maintain 100% cooling efficiency even at 43°C, unlike standard units that lose cooling capacity as temperatures rise," Hingorani explained.

Blue Star has launched a formidable range of flagship models, including super-energy-efficient ACs, heavy-duty ACs, hot-and-cold ACs, and ACs with anti-virus technology. Specifically designed for markets like Srinagar, hot and cold ACs offer year-round comfort

"The company specifically designs the heavy-duty ACs for regions such as Punjab, Uttar Pradesh, Delhi, and others in North India, where temperatures can reach up to 50°C."

Girish Hingorani, Blue Star

Strengthening presence in North India with Virat Kohli

Hingorani said that since the company’s foray into the residential AC segment in 2011, Blue Star has had a strong presence in South India. For the past few years, the company has been making efforts to strengthen its presence in North India and hence roping in the biggest celebrity with a huge following, Indian cricketer Virat Kohli.

Kohli has been associated with Blue Star since 2019, making it a six-year-long partnership. This time he has been featured in the third season of the brand’s Garmi Ki Chhutti campaign, which personifies heat as an antagonist, with Kohli representing Blue Star’s superior cooling technology.

The brand aims to create advertising that is not just informative but also engaging. "In today’s digital age, people do not have the patience to watch ads. We want to make them entertaining and memorable, ensuring a high engagement rate," he added.

Launched on YouTube on March 13, Hingorani revealed that the latest campaign has achieved a high view-through rate (VTR) of nearly 60%. Unlike non-skippable ads, the campaign relies on skippable formats, where viewers can skip after four seconds. Despite this, Blue Star's commercials have recorded a retention rate between 55% and 60%.

Multi-platform advertising strategy

For fiscal 2026, the company has lined up investments worth Rs 310 crore. During the summer, it will spend about Rs 50 crore on advertising. Another Rs 200 crore will be used to increase production at the Sri City plant, and another Rs 60 crore will be spent on research and development.

The company has been advertising on IPL since 2018. For this season, Blue Star has taken a multi-platform approach.

"We have invested in connected TV advertising via JioHotstar, along with high-definition slots on Star Sports. Our ads will run across multiple matches."

Girish Hingorani, Blue Star

Discussing the company’s media strategy, Hingorani said, “We place significant emphasis on digital and e-commerce marketing, ensuring our performance campaigns are strongly aligned with online retail platforms. We also invest in news, outdoor advertising in select northern markets, and targeted print publications.”

About 50–60% of ad spend will go towards television, including connected TV and OTT platforms. Digital marketing, including e-commerce marketing, will receive around 30% of the budget, with connected TV falling under the television category. The remaining 10% will be allocated to outdoor and print.

Investment and growth plans for fiscal 2026

The company operates three manufacturing facilities for ACs—two in Himachal Pradesh and one in Sri City, Andhra Pradesh. 

This year, its production capacity is expected to rise to 1.4 million units, with a further increase to 1.8 million units by FY27. Of this, 6.5 million units will be produced at the Himachal Pradesh plants, while the remaining units will come from the Sri City facility.

The residential market has been dominating the air conditioning sector, making up over 90% of total sales. Commercial usage, which includes applications in ATMs, salons, and small businesses, remains a minor segment, and window ACs account for only about 7% of the overall market. 

This shift is driven by the rise of split ACs, which are more efficient and quieter and do not occupy window space.