Daikin Industries invests Rs 1,400 cr in India to boost local manufacturing

According to recent regulatory filings by Daikin Airconditioning India with the Registrar of Companies (RoC), this capital was provided in two phases: Rs 600 crore in June and Rs 800 crore in August

Japan's leading air-conditioning manufacturer, Daikin Industries, has made a significant investment of Rs 1,400 crore into its Indian subsidiary.

This marks its largest capital infusion to date, aimed at enhancing local production of finished goods and components, according to a report by The Economic Times.

Daikin Industries: Investment details

As per recent regulatory filings by Daikin Airconditioning India with the Registrar of Companies (RoC), the investment was executed in two phases: Rs 600 crore in June and Rs 800 crore in August.

Following this second phase, the subsidiary’s paid-up share capital rose to Rs 1,582.9 crore. The company has also expanded its authorised share capital from Rs 1,500 crore to Rs 3,000 crore in May, leaving room for future capital infusions.

These filings reveal that the increased authorised share capital will support Daikin's ongoing business expansion, including the second phase of its plant at Sri City, Andhra Pradesh, and help reduce interest expenses.

Daikin Industries: Strategic expansion

KJ Jawa, Chairman and Managing Director of Daikin Airconditioning India, stated that the funds will be used to enhance manufacturing capacity, with a focus on boosting the production of components such as compressors.

Daikin aims to increase the localisation of its air conditioners from 75 to nearly 90 per cent, reinforcing its leadership in India’s production-linked incentive (PLI) scheme for air conditioners.

Jawa further noted that the Rs 1,400 crore will primarily fund construction, research and development infrastructure, skill development, brand promotion, and internal operations. The investment is intended to maximise the potential of their 75-acre manufacturing facility, which includes a compressor and device factory in Sri City.

Daikin India competes with major players in the Rs 30,000 crore Indian air-conditioning market, including Tata-owned Voltas, LG Electronics, and Lloyd, which is owned by Havells.