Blue Star to Invest INR2150 Million in India

India: Air-Conditioning and Commercial refrigeration major, Blue Star, is investing a sum of INR2150 million is setting two units in India to manufacture air conditioners, deep freezers and water coolers. Plant at Andhra Pradesh will carter the southern India market. With this investment, blue star’s total plant count in India would be seven. Recently, Blue star closed their units at Thane and Bharuch in this fiscal year.

Keeping in mind their previous fiscal sale of 3.1 lakhs air conditioners, blue star is eyeing an increase in sale of air conditioners by 12 percent this fiscal in India.

According to TechSci Research, with investment of over INR2000 million, Blue Star will be able to capture a larger market share in the Indian air conditioners market. Furthermore, the company’s strategy to open a designated plant for southern region of the country will help the company to cater that market effectively and efficiently. It would also help the company to de-risk the products business as the company’s plants are spread throughout the country.

According to a report published by TechSci Research, “India Air Conditioners Market Forecast and Opportunities, 2020”, the Indian air conditioners market is projected to grow at a CAGR of over 10% during 2015-20. Accounting for a lion’s share of the air conditioners market, split air conditioners segment was the highest revenue generator, followed by VRFs and window air conditioners in 2014. The market share of window air conditioners has been declining over the last few years on account of decreasing price gap compared to split ACs, due to which many leading companies such as Samsung and LG have exited from the windows air conditioning segment while other major companies like Voltas, Daikin, Blue Star, etc., have lowered the production of window air conditioners in the country. Northern India generates the highest revenue in the country’s air conditioners market, followed by Southern and Western regions.