Fuji Electric (FE) is in the process of expanding its manufacturing and Research and Development (R&D) operations in the country as the Japan-based energy and power electronics major is going ahead with its India 2.0 growth strategy despite the disruption caused by the pandemic.
The proposed expansion across Pune and Chennai will see cumulative hiring of about 200 people in phases, both for its manufacturing and R&D operations. Investment details were not disclosed.
“Our India 2.0 growth plans broadly remain the same as shared in November 2019 for Fuji Electric in India. While definitely the pandemic and lockdown have caused a short-term delay in our planned activities, we see the current situation as being temporary in nature and India continues to be an attractive target market for Fuji Electric. So, we are going forward with all our investment plans for expansion of our manufacturing, R&D and product offerings in India,” Sriram Ramakrishnan, Managing Director of Fuji Electric India, told BusinessLine.
Fuji Electric in India operates across a wide spectrum of industry segments. It has been witnessing recovery in its customer segments at different levels, and in this quarter healthcare and manufacturing sectors have exhibited strong recovery. However, the company expects a full recovery during the second quarter of next year.
To support its volume growth, increased localisation and for the launch of new products, the company is expanding its manufacturing facilities in Chennai and Pune by 50,000 sq ft and 75,000 sq ft respectively. This expansion is being done to increase the manufacturing capacity of three product categories; variable frequency drive (VFD), UPS and solar inverters.
The company will be rolling out localised data centre UPS products, produced at its Pune unit. These products are currently manufactured outside the country. The company will also be launching megawatt-scale solar inverters made out of the same factory. “This will be the first Fuji electric product designed and developed in India for India. This solar inverter will also be exported to regions like the Middle East,” said Ramakrishnan.
Manufacturing expansion in Chennai will involve ramp-up at the existing factory at Perungudi and launch of a new unit, which is being finalised.
In Chennai, the ramp-up is being planned to produce localised VFD products as the company is keen on expanding this business with the cost-competitive edge. To support this, a new R&D team has been set up in Chennai for customisation and other requirements. This will be the company’s second R&D facility after the Pune Centre, which employs about 50 people now.
“We are striving to achieve the target of ₹1,500 crore by FY23-24 with the assumption that there is no further setback due to the pandemic and the India market recovers to normalcy by next year (FY22),” said Ramakrishnan.
The 11-year-old Fuji Electric India acquired Consul Neowatt, a strong player in the Indian UPS product segment with more than four lakh installations in India and abroad, in mid-2019. Consul was also operating four factories and an R&D centre supported by a wide service network and huge service staff. Fuji indicated that Consul’s low-cost manufacturing capabilities will help it emerge as a strong player in the Indian power electronics market.