Danfoss coming up with manufacturing and R&D hub in India

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Denmark-based mechanical and electronic components maker Danfoss Industries is setting up a greenfield manufacturing and R&D hub near Chennai.

"The facility at Oragadam near Chennai is spread over 50 acres and would be fully ready by the end of this year. It would employ around 1200 people and the focus would be on Research and Development (R&D) capabilities," Danfoss president Ravichandran Purushothaman told reporters here.

The unit would be complete with three labs and high-end equipments for testing.

An industrial area located on the outskirts of Chennai, Oragadam would also be a manufacturing hub for the subsidiary of Euro 4.5 billion Danfoss Group.

The company has already committed to invest Rs 500 crore in India by 2015, Purushothaman said.

Currently India is Danfoss' 12th largest market and now they expect it to be among the top five within the next five years and increase sales three fold by 2015, he said.

The company is among the top manufacturers of electronic controls for power sector including renewable energy, refrigeration, air-conditioning and commercial compressors.

He said the company is now targeting West Bengal market as it incurred the highest loss of horticulture produce at Rs 13,657 crore in the distribution chain.

"Bengal lacks proper adequate storage facilities for potato. This is where our energy-efficient solutions in the cold storage system comes in," he said.

Cold storage facilities have been running losses as the government hasn't approved any significant rental hikes since 2010 when it was last raised largely on account of increases in labour, electricity and diesel costs through the years.

Cold storages in West Bengal have been reeling under losses due to a 50%  rise in input costs in the last three years. At least two-thirds of the cold storages in West Bengal are facing closure as a result.