June 13, 2010 (LBO) - Sales of refrigerators in Sri Lanka had picked up sharply in the first amid an overall economic revival and the opening of markets in the north and the east of island following the end of a war, an electric goods firm has said.
Regnis Lanka Ltd, a unit of Singer (Sri Lanka) which mostly puts together refrigerators said revenues from refrigerators rose 60 percent in the first quarter.
Regnis chief Hemaka Amarasuriya told shareholders in a quaterly review that consumer markets were showing sign of "early recovery" from the downturn in 2009.
"..[C]urrent growth rates are sustainable up to mid-year and possibly thereafter in order to fulfil unsatiated demand for the replacement market," he said.
"Expansion of rural electrification accompanied by a return of consumerism in the North signals a period of strong and sustainable growth for the white goods industry with new customer entry."
In Sri Lanka electric goods were taxed heavily by the state with rulers and bureaucrats labelling them 'luxury goods' and limiting their possession to only 'richer' people.
Last month the state cut import duties of many electric good putting them within the reach of a greater number of people in the island with lower levels of income who could not afford them earlier due to high taxes.
High import taxes could also trigger unsustainable domestic industries which are not internationally cost competitive, which essentially engage in tax arbitrage, and are exploiting consumers jointly with the state.
Regnis, which is a captive production unit for its parent said total revenues rose 67.2 percent to 531.3 million rupees, and after tax profits rose more than 11 times to 21.1 million rupees.
source - www.lbo.lk
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