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Tata group company Voltas has planned a capital expenditure of ₹350-400 crore in order to comply with the Government’s Production Linked Incentive (PLI) Scheme’s requirements for manufacturing components.
Voltas, which has expertise in air conditioning and cooling technology, had registered in the PLI scheme for manufacturing several components, including compressors for room ACs. “This is an important step towards our goal of backward integration and will help us secure our supply chain against political and trade uncertainties,” said Pradeep Bakshi MD & CEO, Voltas, in the latest annual report.
Centre’s PLI scheme
In 2020, the Government had announced an outlay of ₹1.97 Lakh crore for PLI Schemes across 14 key sectors, large-scale electronics manufacturing; and white goods. This was to create national manufacturing champions, 60 lakh new jobs, and an additional production of ₹30 lakh crore during next five years.
The PLI Scheme for White Goods (PLIWG) proposes a financial incentive to boost domestic manufacturing and attract large investments in the white goods manufacturing value chain. Its prime objectives include removing sectoral disabilities, creating economies of scale, enhancing exports, creating a robust component ecosystem and employment generation.
Bakshi said Voltas is in the process of setting up an additional manufacturing facility for room air conditioners and expanding the installed capacity for commercial refrigeration products. The company is looking to strengthen its domestic manufacturing at its facilities at Waghodia, Pantnagar and the new plant proposed in South India, per the report.
Bakshi said Voltas is working towards introducing a Smart Home with IoT (internet of things) capability by providing Wi-Fi in ACs.
New JV
Voltas has entered a joint venture with Highly International (Hong Kong) Ltd, a wholly-owned subsidiary of Shanghai Highly (Group) Company Ltd.
This JV would engage in the business of design, development, manufacture, marketing, sale and service of inverter compressors for room ACs, motors for inverter compressors and their associated parts. “Our company will have a 40 per cent stake in the JV and it will help the company be a key beneficiary of the PLI Scheme,” the report said.
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