The company aims to increase its capacity to 2.6 million by the end of 2022
Indian contract manufacturer EPACK Durable is looking to raise Rs 160 crore from funds managed by private equity firm ICICI Ventures. The funding will be used towards expanding its manufacturing capacity significantly, top company executives said.
The infusion of fresh equity capital will help the company expand capacity and focus on backward integration with the addition of capacity for multiple components.
EPACK is India’s second-largest contract manufacturer of room air-conditioners (RACs), has manufacturing facilities in Dehradun.
The company targets to increase its RAC capacity to 3 million units per annum by 2025, to capture the growing demand of RACs in India and cater to the needs of export markets as well.
It has an installed capacity of over 1 million RAC and 1 million SHA units where it manufactures RACs and small household appliances (SHAs) for Indian and multinational company brand as an outsourced design manufacturer with in-house R&D capabilities.
“RAC penetration in India is lowest with penetration in 7-8% households only. Over the last two decades, EPACK has been building manufacturing capabilities to manufacture room air-conditioners and small home appliances. We have built strong business relationships with all key brands. The new capital will help us deepen our manufacturing and R&D capabilities, and gain more market share over the next 4-5 years,” Sanjay Singhania, promoter director, EPACK Durable said in an interview.
The company plans to invest ₹500 crore in the next 4-5 years to expand its capacity and is already in the process of setting up a greenfield manufacturing facility near Bhiwadi in Rajasthan, which is expected to be commissioned in the third quarter of the current financial year.
It has also announced plans for setting up a greenfield manufacturing plant in South India, which is expected to be operational by Q3 of 2022.
The company aims to increase its capacity to 2.6 million by the end of 2022, said Singhania.
The company manufactures a complete range of room air-conditioners, including window ACs and split ACs, with the latest technology, including fixed speed and inverters.
The company also manufactures home appliances, including induction cooktops, mixer grinders and water dispensers.