Consumer rebound faces new test from oil prices, grey market: Singer

• Says Singer’s local manufacturing operations would provide an important buffer against external shocks, although consumers could still face impact of higher transportation and logistics costs if global conditions deteriorate
• Asserts grey market remains active as relatively high VAT increases difference between businesses that follow law and those that don’t

Mohan Pandithage

By Shabiya Ali Ahlam

Sri Lanka’s consumer recovery could face fresh headwinds from the rising global oil prices, higher shipping costs and a thriving informal market, according to Singer (Sri Lanka) PLC, a market leader in consumer durables, even as the retail giant delivered its strongest earnings growth in years.

Businesses worldwide are currently grappling with uncertainty stemming from tensions in the Middle East, a region that plays a pivotal role in global energy markets and trade routes.

Singer Chairman Mohan Pandithage said the company was closely monitoring the global developments as higher oil prices could disrupt the supply chains and increase the cost of bringing products to market.

“We note that the IMF has reduced the global growth projections and these developments are key inputs to our risk assessments as they impact the supply chains and growth strategies,” Pandithage said in the company’s latest annual report.

He said Singer’s local manufacturing operations would provide an important buffer against the external shocks, although the consumers could still face the impact of higher transportation and logistics costs if the global conditions deteriorate.

The cautionary note accompanied a year of exceptional performance for the retailer, which reported an 83 percent increase in profit after tax to Rs.7.66 billion for the financial year ended March 2026.

Singer said the results reflected a strong execution of its growth strategy, an expanding product portfolio and a broader customer base that now exceeds three million Sri Lankans.

Yet, even as consumer confidence improved and spending gradually recovered, Pandithage highlighted another challenge closer to home, which is the informal economy.

“The grey market remains active, largely because relatively high VAT increases the difference between the businesses that follow the law and those that don’t,” he said.

There has been a growing debate within the business community over the impact of taxation and informal trade on legitimate businesses.

Singer said the consumers were increasingly opting for authorised products supported by warranties and after-sales service, helping the company defend its market position, despite the competition from the unregulated imports.

The company also continued to broaden its reach beyond the traditional home appliances during the year, securing partnerships with global brands including Starlink and HP, while expanding into new categories such as electric mobility through its partnership with TailG electric bikes.

Digital products emerged as one of Singer’s strongest growth drivers, generating Rs.26.7 billion in revenue during the year, underscoring the increasing appetite among Sri Lankan consumers for connectivity and technology-driven products.

Despite the mounting global uncertainties, Pandithage said Singer was entering the new financial year with confidence, backed by its nationwide footprint, diversified sourcing strategy and growing local manufacturing base.