Daikin to to set up plant in Rajasthan; to invest Rs 160 cr

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Neemrana, Rajasthan, Jul 9 (UNI) Daikin Airconditioning India Pvt Ltd (DAIPL), a wholly-owned subsidiary of world's second largest air-conditioner maker Daikin Industries Ltd, today set its manufacturing unit here with an initial investment of Rs 160 crore.

The plant, which will commence operation by September next year, will have an annual production capacity of 20,000 variable refrigerant volume units (VRVU) and 1,800 chiller units.

''With this factory going onstream, Daikin projects sales in excess of the Rs 1,100 crore in FY2010,'' DAIPL Managing Director Toshiki Hayashi told reporters at the ground breaking ceremony here.

Daikin has manufacturing facilities in Japan, Thailand, Europe and China.

It plans to manufacture multi-split type commercial-use airconditioning equipment and chillers (large-capacity airconditioning heat source equipment) at the Rajasthan unit. When put into operations, the plant would provide direct employment to about 300 people.

The company will use the plant for exports as well. ''After three years of operations, we will start exporting to West Asia and countries neighbouring India,'' Mr Hayashi said.

India is a niche market for the company, with a contribution of about one per cent to its global revenues. But with the increased emphasis, it plans to make India one of its major markets.

Asked if the prices will come down once Daikin begins production here, Mr Hayashi said it would bring down duties but essential parts which are not made here, will have to be imported. ''The scale of cut will not be that high,'' he said.

The company pays duties to the tune of 30-45 per cent.

The focus will also be on big projects like orders from airports, metro stations etc. ''We expect to sell 700 chillers with 400-500 tonnage annually by FY2010. This segment, which is a recent foray, will be an important one to contribute to our target of sales worth Rs 1,100 crore by 2010,'' said Mr Hayashi.

About 70 per cent of Daikin's business comes from the non-domestic segment.

Asked if the company was planning to hike prices amid the rising input costs, Mr Hayashi told UNI that the company, as a hedging mechanism, buys the raw material much in advance. ''We buy the raw material in advance, we the price fluctuations do not affect our imput costs that much. However, looking at the current scenario, we will have to take a call on costs,'' he said.

UNI SR PDT HT1810

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