Blue Star To Invest Rs 400 Crore In Fiscal 2026 To Expand AC Manufacturing Capacity

Blue Star Ltd is set to invest Rs 400 crore in fiscal 2026 in order to expand its manufacturing capacity in room air conditioners and commercial refrigeration as well as commercial air conditioning segments, according to a statement from a high-ranking company official on Thursday.

The firm will allocate Rs 200 crore to the third phase of its Sri City plant to increase room air conditioner capacity by 12 lakh units from the current 8.5 lakh units.

The air conditioning solutions company will invest Rs 53 crore in its commercial freezers unit close to Mumbai and Rs 150 crore in the commercial air conditioners located in its Himachal Pradesh plant.

"We are aiming at 20% growth in fiscal 2026. We estimate to end the current fiscal with 25% growth backed by robust growth seen in the room air-conditioner business. The room air conditioner business is expected to grow 30% in the first quarter of fiscal 2026 against around 50% growth in fiscal 2025," Managing Director B. Thiagarajan said.

The industry registered unprecedented growth in room air conditioners in the year prior, owing to severe heat waves and an extended summer.

The company anticipates an increase in its market share in important segments due to innovation, quick delivery, and growth in the Quick Commerce and QSR segments.

The in-room AC market share is projected to grow marginally from 13.75% to 13.8% by the end of the current fiscal year and further to 14.25% in fiscal 2026.

In commercial refrigeration, the company aims to increase its market share from 30% to 33%.

The company announced plans to launch a broad portfolio of commercial refrigeration products in Kolkata designed for sectors including horticulture, dairy, ice cream, poultry, processed foods, quick service restaurants, HoReCa, marine, pharmaceuticals, and healthcare.

Blue Star's addressable market in commercial refrigeration is around Rs 5,000 crore out of the total Rs 8,000 crore market, excluding ammonia-based cooling systems where the company is not present.

Thiagarajan said the company is evaluating capex for manufacturing in the Eastern region, where its room AC market share has grown to 13% from 10% and commercial refrigeration share to 8-10% from 7-8%.

Blue Star's revenue rose 25.3% to Rs 2,807.36 crore in the third quarter of Fiscal 2025 compared to the year-ago period.

(With Inputs From PTI)