Blue Star anticipates a recovery in its room or residential air conditioners and commercial refrigeration businesses by the last quarter of the current financial year, following a significant revenue decline due to disruptions caused by COVID-19. Despite reporting a consolidated net loss of Rs 19.66 crore for the first quarter ending June 30, 2020, the company reassured that its manufacturing and supply chain operations are fully operational.

Having posted a net profit of Rs 76.84 crore in the same quarter the previous year, Blue Star has implemented cost-cutting measures to align with potential revenue losses. The company has infused capital through long-term debt to fortify its balance sheet, with a focus on prioritizing project execution based on cash flow, as stated in an investors’ update.

Blue Star expects a gradual recovery in the room air conditioners and commercial refrigeration businesses, forecasting a return to normalcy in the market by Q4FY21. The company identifies healthcare, pharma, and processed foods segments as areas offering promising opportunities for its commercial refrigeration business in the new normal.

Despite challenges, Blue Star aims to navigate this phase with balance and agility, emphasizing prudent management of working capital and operating costs while ramping up revenue. In the first quarter of the current fiscal year, Blue Star’s revenue from unitary products, including room air conditioners, commercial refrigeration, and water purifiers, experienced a decline of 69.7 percent compared to the same period last year.

The room air conditioner business saw a market contraction of nearly 65 percent during the quarter, attributed to the closure of conventional retail outlets and non-essential e-commerce sales until late May due to the ongoing COVID-19 pandemic. While the impact on the water purifier business was relatively moderate, Blue Star reported total revenue from operations of Rs 626.02 crore during the first quarter ended June 30, 2020, compared to Rs 1,575.45 crore in the corresponding period of the previous fiscal year.