Blue Star to invest Rs 215 cr to set up facilities in Andhra and Jammu

Blue Star Ltd to set up new facilities at Sri City, Andhra Pradesh and one in Samba in Jammu. The two plants will attract an investment of around Rs 215 crore.

As part of the programme the company has decided to close down its Thane and Bharuch plants.

The company in a release said that the investment will spread over in 3-4 years and will increase the overall production capacity by about a million units towards the final phase.

Blue Star was advised by KPMG to expand its manufacturing footprint programme.

B Thiagarajan, executive director & President - AC&R Products Business, Blue Star said that the Sri City facility will be the largest facility in the AC&R industry in India.

The company currently has five plants in Wada, Dadra, Ahmedabad and Himachal Pradesh.

The Sri City plant is to be built around an area of around 20 acres and the Samba factory is to be constructed over 24 acres. These factories will primarily manufacture room airconditioners, deep freezers and water coolers.

Blue Star said that the Samba facility would enable the company to avail itself of the excise duty exemption for a period of 10 years from the commencement of production.

Apart from planning to avail itself of state GST benefits for intrastate sales, the Sri City plant would lead to saving of logistics cost, since a significant proportion of airconditioner sales of the company in South. It would also de-risk the products business due to the spread of its manufacturing footprint in two different states.

The Samba facility is expected to commence operations by FY18, while land procurement at Sri City is expected to begin at the earlier and expected to commence operations by FY19.