Daikin aims to turn India into global exports hub by 2030
GURGAON : Daikin Airconditioning India, the local subsidiary of the Japanese cooling major Daikin Industries, is gearing up to boost its operations rapidly over the next few years. The global management, in concert with the local team, has decided to turn India unit as major exporter of its products globally.
The Indian government’s push to increase local production of air conditioner components at a competitive price against China’s, is a key factor behind the move. Additionally, the growth momentum that Daikin Airconditioning India is already witnessing here is another reason why the Japanese major is putting its bet on the India unit, says a senior executive.
Daikin that entered India in 2003 has since grown into a major player in the local AC market and has built its manufacturing base spread across three plants. “We were selling just 3,000 units in 2010 and last year, we actually sold more than the entire [Daikin’s] Asia and Oceania put together. In RAC [room AC] segment, we sold some 1.2 million units in 2023,” Kanwaljeet Jawa, Chairman and Managing Director of Diakin Airconditioning India told.
Jawa says, sales numbers from current summer has given him confidence about its target of selling 2 million RACs in 2024 and he is now aiming a revenue target of US$ 2 billion in FY2025. In FY2024, the company raked in Rs 10,500 crore (US$ 1.2 billion) in sales.
Buoyed on the high demand for RACs in India and its expanding manufacturing footprint, Jawa now says that India could well be the exports hub for Daikin globally by 2030. The company has already set up three plants in India. The latest, located in Sri City Andhra Pradesh is built at a cost of Rs 1,700 crore and manufactures key AC components like compressors that forms over 50% of the cost of materials for an AC. Taking advantage of the production linked incentive (PLI) scheme for AC components, Daikin is now looking to increase its exports from India.
It plans to take the localisation level to 75 per cent from the present 53 per cent, helped by domestic manufacturing of compressors and PCB circuits, among others. Daikin is already exporting to markets as South Africa, Middle and South America helped by its new 75 acre Sri City manufacturing unit, which is its largest factory in South East Asia. Boosted by exports, by 2030, it expects sales to grow to 5 million units.