Godrej Appliances, the consumer durables division of Godrej Group, is targeting a 25 per cent revenue growth to nearly Rs 5,000 crore in 2018-19.

"We should be close to Rs 4,000 crore this financial year. We will be targeting a 25 per cent growth next year, at close to about Rs 5,000 crore," Godrej Appliances business head and executive vice-president Kamal Nandi told PTI here.

"I expect 2018 should be better, because the challenges that we faced in 2017, with both demonetisation as well as GST implementation, the overall industry should be growing and demand should be better. We definitely expect that the GST rate change will happen soon from 28 per cent to 18 per cent and that should propel the industry growth," he added.

The company expects the air conditioner (AC) segment to be a growth driver and aims to increase its overall market share to 8 per cent from 5 per cent at present. The size of the AC market is estimated at 55 lakh units growing at a compounded rate of 20 per cent.

However, the penetration levels of AC is merely around 3.6-3.7 per cent in the country, according to industry estimates.

Air conditioners currently contribute to around 20 per cent of the company’s revenues and is likely to increase to 21 per cent in FY19. Nandi noted that the tier I to tier IV cities are driving consumption and with the rural-focused budget, states with more agri-economy is likely to fuel demand.

"Budget will favour agriculture economy and we can expect consumption to go up in places like Punjab, Odisha, Tamil Nadu, Maharashtra, Assam. Our expectation is that tier I to tier IV cities will grow faster than metros is the coming years," he said.

He also noted that consumption of premium products in tier I to tier IV cities is the highest.