Havells India Ltd. to Invest Rs 480 Crore in Refrigerator Manufacturing Facility in Rajasthan
Last Updated on November 20, 2024
According to a report released on Tuesday, Havells India Ltd, a significant player in the consumer electronics sector, has announced plans to invest Rs 480 crore to set up a new refrigerator manufacturing facility in Ghiloth, Rajasthan. The facility, which is expected to have an annual production capacity of 14 lakh units, will significantly enhance Havells’ position in the home appliances market. The plant is slated to become operational by the second quarter of FY27.
Backward Integration and Economies of Scale
The company cited backward integration and economies of scale as key reasons behind the decision to build the new facility. By manufacturing essential components in-house, Havells aims to reduce its dependence on third-party suppliers and gain more control over its supply chain. This strategy will allow the company to better manage costs, improve production timelines, and ensure higher quality control. The move is expected to bolster Havells’ ability to meet increasing demand in the refrigerator segment while maintaining competitive pricing.
Funding and Timeline
As per the report, Havells will fund the Rs 480 crore investment through internal accruals, showcasing the company’s strong financial position. The project is expected to be completed by FY27, with the plant scheduled to begin operations by the second quarter of that fiscal year. The company stated that this timeline will allow it to carefully execute the project and meet the desired capacity and quality benchmarks.
Economic Impact and Job Creation
The establishment of the new plant is expected to have a positive impact on the local economy, particularly in the Ghiloth region of Rajasthan. In addition to driving infrastructure development, the facility will create numerous job opportunities, both directly and indirectly. The report highlights that the plant’s production capacity of 14 lakh units annually will provide significant employment benefits to the region, boosting local businesses and suppliers.
Industry experts believe that the new facility will also contribute to the economic growth of Rajasthan, creating a ripple effect throughout the state’s manufacturing and supply chain sectors.