Eyeing the burgeoning growth in the retail segment and the modernisation of airports across the country, Japanese air-conditioning giant Daikin Airconditioning India Pvt Ltd (DAIPL) will set up a plant in Neemrana, Rajasthan at an investment of Rs 160 crore. The plant, which will initially manufacture big capacity AC machines including variable refrigerant volumes (VRV) and chillers, will become operational by September 2009.
“The robust demand of commercial air conditioners will help Daikin, which is largely present in the premium AC segment, increase its market share in the country from 10% now to 15% by 2010 as well as more than double our revenues from India,” said Toshiki Hayashi, managing director, DAIPL, while laying the foundation stone of its first plant in India.
The company, which was so far catering to the residential as well commercial AC market in the country through imports, posted revenues of Rs 400 crore. While Daikin expects this to go up to Rs 500 crore in this fiscal, it is optimstic that the new plant will help it to more than double its market share to Rs 1,100 crore by 2010.
The total air conditioning market currently stands at Rs 4,000 crore and this is expected to grow at a compound annual rate of 35% to touch Rs 7,500 crore by 2010. While, LG Electronics, Samsung India and Haier India currently dominate the residential air conditioning market, commercial refrigeration market is dominated by players like Daikin, Toshiba and Mitsubishi.
The company is planning to manufacture 20,000 units of VRVs (ranging from 4-45 tonne) and 1,800 units of chillers (ranging between 50-1,000 tonne) from its plant till 2010. However, around 50% or 10,000 units of VRVs and 700 units of chillers that comes in an average capacity of 500 tonne will be sold in the domestic market during this period.
“After we manage to meet the requirements in the domestic market, the company would also look at exports to far-east and middle-east countries in the near future,” said Sanjay Goyal, head (sales and marketing), DAIPL. Daikin entered into the Indian market in 2000 in a joint venture with Siddharth Sriram group. However, the tie-up ended in 2003 and since then Daikin is serving the market entirely through imports.
