In a strategic push to strengthen its manufacturing and energy solutions portfolio, Danfoss India has announced plans to invest ₹1,500 crore over the next 5 years. The company aims to ramp up production of compressors and battery energy storage systems, while tapping into rising demand for cooling solutions driven by the data centre boom. It is also increasing focus on energy-efficient technologies such as heat pumps.
At the same time, the ongoing US-Iran war could challenge growth plans, with the company closely monitoring supply chain disruptions and rising freight costs.
“We are expanding our localisation; our current localisation is about 55-57 per cent and we want to take it to 80 per cent,” Ravichandran Purushothaman, President, Danfoss India, said in an interaction with media persons on Wednesday. “We are also looking to double our production capacity in compressor plant in Bengaluru and are also expanding our footprint into newer products in India, especially more India-led,” he added.
Danfoss India currently ranks as the fifth largest entity within the group and is expected to become the third biggest market by 2030. “We are roughly 5 per cent of the global turnover roughly right now,” he added.
For FY2025 (January-December), the company reported total global sales of EUR 9.4 billion, marking 3 per cent organic growth. Cash flow reached a record EUR 734 million. The India region recorded strong double-digit growth in local currency, supported by demand from OEMs and investments in marine, infrastructure, and data centre cooling systems. Danfoss allocated 5.3 per cent of its revenue to R&D in 2025.
Globally, data centre sales contributed around 7 per cent of total revenue, nearly doubling year-on-year. “We expect our data center share to go from 7 per cent to about 10-11 per cent in 2026,” Purushothaman said.
Looking ahead to 2026, the company is watching for potential pressure on infrastructure demand due to the war, along with cost escalation and logistics challenges.
“We are not seeing much impact till about first week of April on our supply chain. But what we are seeing as a challenge is the increase in freight for exports, availability of vessels for exports,” he said. “What used to take a normal time is getting extended by 2 weeks at the moment actually,” he added. Suppliers are also monitoring possible shortages of LPG, PNG, and Helium.
Purushothaman noted that the war could accelerate electrification trends, particularly increasing adoption of heat pumps.
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