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Japanese air-conditioning major Daikin, which is witnessing robust growth in India, is planning to set up a Greenfield manufacturing plant in either South India or the western region.
The Indian arm of the company is looking at making the proposed unit a hub for regional exports, including to Africa and also to serve the growing market in India.
Speaking to BusinessLine, Kanwal Jeet Jawa, Managing Director and CEO of Daikin Airconditioning India, said: “A cross-functional team is engaged in the task of finalising the plant location, which is likely to see an investment of up to ₹500 crore to ₹600 crore.”
“We had set up out first factory in India in the year 2007 and commissioned the second one in 2017, both located at Neemrana in Rajasthan. The company, which had invested about ₹1065 crore from 2010-2014 on the first factory, followed it up with an investment of ₹550 crore in 2015-16 for expansion of the factory and to set up an R&D centre. In addition, about ₹550 crore was invested in the second factory commissioned last year at Neemrana,” he explained.
The facility has capacity to manufacture 15 lakh of room ACs, 50,000 VRVs (variable refrigerant volume), 1 lakh cassette units, 20,000 ductable units and 1000 chillers.
“We have adequate capacity to handle the domestic market but our target of 1 million unit sales has been advanced from 2020 to the year 2019 as Daikin is witnessing strong volume growth. Even though we have capacity now, we are also looking at making India as a hub for the region, particularly for Africa,” he said.
“As per estimates, the Africa AC market is projected to grow to 12 million ACs by 2022 and we are keen to garner a tenth of this market,” he said.
Referring to the domestic market, he said, “The long term market is expected to grow at double digits and Daikin will grow at a much faster rate. We had closed last financial year with a turnover of about ₹4,000 crore, up from ₹3,250 crore in 2016-17 and expect to sustain the growth momentum across all segments, including home ACs.”
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