Industry

Danfoss India eyes 20 per cent annual growth

The Indian subsidiary of the Denmark-based heating, ventilation and air-conditioning major Danfoss is targeting an annual growth rate of 20 per cent making the sub-continent one of the top five markets for the group by 2020, a top official said.

“While the U.S. market is good, Europe market is recovering. South Africa presents a mixed picture. There is a risk in global trade. However, India is a shining star. With a strong sales network, it has been posting 17 per cent year-on-year growth and it has the potential to touch 20 per cent soon. It might replace France and Italy. The top management team has landed here to extend its support,” Kim Fausing, Danfoss Executive Vice President and Chief Operating Officer.

Currently, Danfoss India, with a revenue of $155 million, occupies the 10th spot. It has been growing at 17 per cent year-on-year. The top five markets of the group are the U.S. with revenues of $1.5 billion contributing about 24-25 per cent of sales income followed by Germany , China, Russia and France/Italy.

New products

To achieve its target, Danfoss India has started adding six new product lines, increasing the suppliers network, entering Tier-II and Tier-III cities, increasing the localisation level and improving the export share, he said.

“While the U.S. market is good, Europe market is recovering. South Africa presents a mixed picture. There is a risk in global trade. However, India is a shining star with strong sales network. It has been posting 17 per cent year-on-year growth and it has potential to touch 20 per cent soon. It might replace France and Italy. The top management team has landed here to extend its support,” he said.

“As part of Make-in-India programme, we are ramping up our production capacity through good pipeline of products. The product line is being expanded to ten from four. We will also build strong supplier base to go in for third shift. Currently, the plant is operating at 60 per cent capacity,” said Ravichandran Purushothaman, President, Danfoss India.

Higher localisation

Asked about the localisation, he said in the last three years, Danfoss India increased the indigenisation level from three per cent to 15 per cent and hopes to double it within the next two years. “For this, we are strengthening the suppliers network from 36 to 100. We are looking for suppliers in areas such as electrical, plastic parts, aluminium and heat sinks,” he said.

Apart from catering to domestic market, Danfoss also exports it products. Last year, it exported goods worth US Dollar 55 million and it will double in three years.

Mr. Purushothaman said by the first quarter of next fiscal, they would have completed shifting the Bengaluru operations of Vacon, the Finland-based company which Danfoss acquired, to Chennai. It would increase the drive panels production capacity from 10,000 to 12,000 panels.

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Printable version | Oct 31, 2020 1:16:59 PM | https://www.thehindu.com/business/Industry/Danfoss-India-eyes-20-per-cent-annual-growth/article16435758.ece

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