KRN Heat Exchanger To Invest Rs 600 Crore In Rajasthan Over Four Years
The company recently opened its Neemrana plant in Rajasthan, marking a significant milestone in its expansion.
KRN Heat Exchanger and Refrigeration Ltd. plans to invest over Rs 600 crore in Rajasthan over the next four years as part of its agreement with the Rajasthan government.
So far, the company has already invested more than Rs 300 crore in its upcoming heat exchanger plant, according to Santosh Kumar Yadav, Chairman and Managing Director of KRN Heat Exchanger.
In October 2024, the company’s wholly-owned subsidiary, KRN HVAC Products Pvt., signed a Memorandum of Understanding (MoU) with the Government of Rajasthan to invest Rs 1,000 crore in a heat exchanger manufacturing unit in RIICO Industrial Area, Neemrana.
“Under the Rising Rajasthan initiative, we signed an MoU with the Rajasthan Government to invest approximately Rs 1,000 crore over the next five years. We have already invested over Rs 300 crore to date, and we plan to invest around Rs 600 crore more in the next four years,” he said in a conversation with NDTV Profit on July 1.
The company started commercial production at its Neemrana plant in May, marking a significant milestone in its expansion. This facility will boost production capacity and support the company’s ambitious growth plans in the coming years. The commercial production at this plant began on May 30.
Confirming streamlined operations at the new plant, Yadav said, “We plan to utilise approximately 80% of the new capacity over the next three years. This year, we expect to operate the new facility at around 20% capacity, while the existing facility is nearly fully utilised.”
KRN Heat Exchanger is a leading producer of heat exchangers, evaporators and condensers. The Rajasthan-based company manufactures fin and tube-type heat exchangers for the heat ventilation air-conditioning and refrigeration industry. Earlier, the company’s entire manufacturing operations were carried out at its consolidated manufacturing facility, comprising two industrial plots in Neemrana. The company made its market debut in October 2024.
Yadav highlighted that the company’s existing capacity is almost fully utilized. “Last year, we achieved almost Rs 400 crore plus turnover from the existing facility, which is the peak for this facility. This year, we are adding about 20% from the new facility. So, you can say Rs 400 crore plus 20% from the new facility. Okay, so about 20% growth is anticipated,” he said.
According to Yadav, the new Neemrana facility will produce both existing and five or six new products. The growth in new products may be slower at first, which could put some margin pressure over the next two quarters.
Yadav expects that after this period, as the new products gain traction, the new facility will begin contributing performance as the existing plant. He outlined that their immediate focus is to fully utilise the existing expanded capacity (about 6x) over the next three years.
“As of now, we are at 6x compared to our existing facility. First, we will achieve full utilisation of this capacity within the next three years. Meanwhile, we may invest a small amount based on line balancing or operational requirements. We aim to complete this 6x utilisation before investing in additional equipment to further increase capacity. So, our primary focus is on the next three years,” he added.
Regarding future growth, he projected a 60-70% increase in revenue in FY26.
In FY25, the company posted consolidated revenue of Rs 430 crore, up from Rs 308 crore in FY24, marking a 40% year-on-year growth.
Shares of KRN Heat Exchanger & Refrigeration Ltd. closed 0.74% higher at Rs 855.5 per piece on the NSE on Tuesday. In comparison, benchmark Nifty 50 ended nearly flat at 25,541.8, up 0.1%.
