The $5.5 billion Danish group Danfoss, logging around 11 percent growth in India, is focusing on cold chain and infrastructure sectors for accelerated growth while it will also be the export hub for the Asia Pacific markets, said a top group official.
Danfoss is also in an acquisitive mood looking out for small companies strong in technology even as it is in the process of acquiring Finnish drives company Vacon, he said.
Danfoss is a global leader in making products that save energy and reduce emissions. Its products are used in cooling food, air conditioning, heating buildings, controlling electric motors and power mobile machinery.
"In India we see good growth potential in the cold chain segment. We are also quite active in the hydraulic solutions for the agricultural sector. For us the Indian operation is logging 11 percent growth while the overall growth for Danfoss is around four percent," Niels B. Christiansen, president and chief executive officer told IANS Wednesday.
He said Danfoss will also make India its regional export hub for some products. Already production of some of the products made in Danfoss's Mexican plant has been shifted here.
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For the Danish group the Indian market is one of its top 10 markets.
On Nov 5, Danfoss commissioned its new Indian facility at Oragadam, around 55 km from here, and in the process brought all its facilities under one roof.
The facility also includes a 1MW solar power plant that would meet 10 percent of its power needs.
The solar power panels are expected to generate around 1.5 million units per annum and is part of the group's global plan of cutting out its carbon footprint by 25 percent by using renewable energy to the extent of 25 percent by 2025.
Speaking about the markets for Danfoss products, Christiansen said the market is good in India, Japan, Turkey and the US while growth is flat in Europe and Russia. The growth rate in China is coming down.
According to him, the strategy is to focus and grow in select product segments while not losing market share in others.
"In Russia we are not losing market share but we are not growing. Russia is one of the largest markets for Danfoss. The Russia-Ukraine trouble is having its impact on sales," he said.
"We are looking at the Russian market with long term perspective," Jesper V. Christensen, executive vice president and chief financial officer told IANS.
Speaking about the status of Vacon acquisition, Christiansen said the idea is to become number two in the global drives market. The group is awaiting clearance from the Chinese authorities.
In Sep this year Danfoss made a tender offer to acquire all the shares of Vacon. The total outlay for the acquisition is around 1,038 million euros.
The offer is subject to approvals from relevant authorities and Danfoss getting more than 90 percent of Vacon shares.
"We have extended the offer. Till now we have got 66 percent stake in Vacon," Christiansen said.
Danfoss is also entering into a 50:50 research and development (R&D) joint venture with German company Bosch Thermotechnik.
"The main team will be located in Germany. Initially the focus will be on R&D and product development. The manufacturing location would be decided later," Noel Ryan, president, Danfoss Commercial Compressors told IANS.
