The falling rupee has put the industry in a precarious position, as the domestic value addition in an LED TV is around 30 per cent only, and major components like the open cell, semiconductor chips and motherboard, are imported.
Prices of televisions are expected to rise by 3-4 per cent from January next year on account of the rising cost of memory chips and depreciation of the rupee, which recently crossed the 90-to-a-dollar mark for the first time.
The falling rupee has put the industry in a precarious position, as the domestic value addition in an LED TV is around 30 per cent only, and major components like the open cell, semiconductor chips and motherboard, are imported.
Moreover, this is coupled with the memory chip crisis, where a severe global shortage is driven by massive demand for High-Bandwidth Memory (HBM) for AI servers, causing prices for all memory types (DRAM, flash) to surge. Chipmakers are focusing on high-profit AI chips, tightening supply for legacy devices like TVs.
Haier Appliances India President NS Satish told PTI that prices of LED TV sets will increase by 3 per cent because of shortage of memory chips and weak rupee.
Some TV manufacturers have already communicated to their dealers about the expected hike in prices.
Super Plastronics Pvt Ltd (SPPL), a TV manufacturing company having licences of several global brands including Thomson, Kodak, and Blaupunkt, said:” Memory chip prices have gone up by 500 per cent in the last three months .” According to its CEO Avneet Singh Marwah, there could be 7-10 per cent price hike in televisions from January, predominantly due to memory chip crisis and the impact of depreciating rupee.
He also warned that if memory chip prices in the next two quarters remain the same, “then there could be further hike in TV prices.” According to experts, this upcoming hike may mitigate the boost received on sales of smart TVs, after the rationalisation of GST. The government has slashed GST on TV screens of 32 inches and larger sizes to 18 per cent from the previous 28 per cent, reducing price by around Rs 4,500.
Similarly, Videotex, a homegrown ODM (Original Design Manufacturer) for several brands, and which has its own brand Daiwa, said it is also facing sustained pressure due to sharp increase in memory chip prices, with availability emerging as a critical challenge.
“We are currently facing sustained pressure due to sharp increase in memory chip prices, with availability emerging as a critical challenge. Flash memory and DDR4 prices at the sourcing level have risen by up to 1,000 per cent, driven largely by supply being diverted to AI data centres,” said Arjun Bajaj, Director of Videotex.
This pressure is anticipated to continue until at least Q2 of the coming year, after which some stability may return depending on global memory chip supply dynamics.
“The situation is further exacerbated by the depreciation of the rupee, which has significantly increased import costs. These increases will be reflected in the market in the coming weeks as older inventory moves out,” said Bajaj.
Though Videotex is adjusting production schedules and optimising inventories to manage the impact, the “prolonged nature of this cycle makes it challenging to fully absorb the cost escalation”.
Videotex manufactures smart TVs for Reliance Group (BPL & Reconnect), Havells (Lloyd), Vijay Sales (Vise), Hyundai, Toshiba, Compaq, Daiwa and over 25+ other prominent Indian and international brands.
