Demand for refrigerators, freezers rises ahead of Eidul Azha

KARACHI: Sales of refrigerators and deep freezers have increased in the days leading up to Eidul Azha, as households prepare to store sacrificial meat during the summer season, according to market participants and industry data cited in a report published by Dawn.

Sohail Malik, finance secretary of the Karachi Electronic Dealers Association, said demand for the two cooling appliances has risen notably compared to the same period last year, while air conditioner sales have remained broadly unchanged.

He told Dawn that "the sales of fridge and deep freezers have been 25-30 per cent higher during this Eid season than last year, while the number of ACs sold shows no big difference."

Malik said many families were purchasing new appliances to avoid spoilage of meat, which consumers generally keep frozen for at least two to three months after Eidul Azha.

Shift in buying pattern after moon sighting

According to Malik, air conditioners were the main item in demand before the Eidul Azha moon was sighted, but consumer interest later shifted towards refrigerators and deep freezers.

He said the surge in footfall had prompted shopkeepers to keep their outlets open until 1.30am, with most customers arriving in markets during the evening hours.

Malik also said there was no shortage of appliances in the market despite stronger demand, attributing this to the availability of unsold stock carried over from last year as well as imported parts and kits used for local assembly.

He further said relative stability between the rupee and the dollar in the interbank market had helped keep manufacturing costs under control.

Appliance lifespan and market size

According to Pak Elektron, the average lifespan of a refrigerator is now 10 years, while that of an air conditioner is six years.

A manufacturer estimated the total size of the appliance market at Rs328 billion.

A BMA research report said PAEL is the country’s third-largest appliance company after Haier and Dawlance. The company holds a 17 per cent share of Pakistan’s refrigerator market, which totals 1.3 million units.

The same report said refrigerator penetration in Pakistan stands at 51 per cent, indicating room for further expansion. It projected refrigerator sales would increase by 20 per cent to 339,000 units in CY26, supported by economic stability, lower inflation, reduced interest rates and stronger consumer financing.

Outlook for air conditioners and deep freezers

The BMA report said PAEL has a seven per cent share in the air conditioner market, with AC sales expected to rise 20 per cent year-on-year to more than 105,000 units in CY26. Air conditioners account for 29 per cent of appliance segment revenues.

In deep freezers, PAEL is the third-largest player with a 15 per cent market share. Sales in that segment are projected to grow 20 per cent to more than 60,000 units in CY26, contributing 11 per cent of appliance revenue.

BMA Capital said PAEL was likely to benefit from a recovery in appliance sales due to economic stability and easing import restrictions. It projected sales volumes may grow 20 per cent in CY26 and 15 per cent in CY27.

Lower interest rates and easier instalment financing were expected to support demand, particularly among middle-income households. Improved crop yields, higher wheat support prices and government support schemes were increasing farmers’ purchasing power and could help drive rural demand.

It also linked future appliance demand to a possible recovery in construction activity, higher housing finance limits under the Mera Ghar Mera Aashiana programme, expected growth in cement sales, rising temperatures associated with climate change and increasing urbanisation.

Economic stability, lower inflation and reduced borrowing costs could encourage consumers to purchase appliances either at lower rates or through monthly instalment plans. The benchmark six-month KIBOR had declined from 24.71 per cent in September 2023 to 11.5 per cent.