Executives said they may have to push the next round of price hike as early as this month itself despite the last price hike undertaken in end-March or April with the falling rupee impacting their immediate consignment of goods coming into the country.
Getty ImagesThough carmakers are also equally impacted, industry executives said they will absorb the impact as of now.
The depreciating rupee has come as an additional pressure for consumer goods makers at a time when commodity prices are rallying and companies will factor in the exchange rate impact in the next price hike for goods such as smartphones, laptops, televisions, refrigerators and even some daily necessities which are dependent on imported raw materials, multiple industry executives said.
Executives said they may have to push the next round of price hike as early as this month itself despite the last price hike undertaken in end-March or April with the falling rupee impacting their immediate consignment of goods coming into the country.
Though carmakers are also equally impacted, industry executives said they will absorb the impact as of now.
Electronics firm Haier India president Satish NS said the input cost pressure has become higher with rupee depreciation. He said the company will hike prices by another 3-5% from this month after last month's 3% increase.
"Already, prices of commodities like aluminium, steel and plastic are up by 8-10% since the last two months and with the rupee depreciation, we have to bridge the gap. Margins of almost all companies are severely bleeding and with the proposed hike, we will be at a breakeven level," he said.
Smartphone and electronics maker Realme India CEO Madhav Sheth said the value of the Indian currency has been staggering for quite some time. While the company anticipates the rupee depreciation to have an impact on the prices of its products, it is working on a strategy to minimize additional costs to consumers, he said.
Godrej Appliances business head Kamal Nandi said the company will factor the rupee impact on its pricing when the next consignment comes in June.
The rupee on Monday touched its lifetime low against the dollar and has been continuing at over ₹77 per dollar, upsetting the consumer goods makers who had earlier benchmarked their pricing at an exchange rate of ₹75 per dollar. Economists expect the local currency will continue to depreciate.
Market researcher IDC India's research director Navkendar Singh said smartphone and computer makers will not absorb the rupee impact and will increase prices by 3-5% from this month itself.
"Demand has been tapering off since last quarter due to inflation and consumers are deferring their smartphone replacement cycle. This price hike will have a further impact on demand," he said.
key necessities Prices of daily necessities too are going to firm up, especially imported or have a higher share of imported raw materials.
"We are dependent on imports for raw materials including stevia, aspartame and palm oil as well as flavours and fragrances. While a weaker rupee is not a huge challenge, it comes at a time when we are already seeing an impact on operating cost due to commodity price inflation. So, the rupee devaluation will just add to the overall burden," said Tarun Arora, chief executive at Zydus Wellness, which sells Complan, SugarFree and Nutralite.
Angshu Mallick, chief executive of Adani Wilmar, which sells the Fortune brand of edible oils, said while prices of edible oil have come down by $100 per ton globally, which could have been an opportunity to reduce prices, the impact of rupee depreciation is to the tune of $50 per ton whereby the opportunity has almost nullified.
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