Grundfos Sets Ambitious Growth Target in India
Grundfos, a renowned pump manufacturer headquartered in Denmark, is setting its sights on a 10-12% annual growth in India. This ambitious goal comes on the heels of the company’s impressive revenue of ₹1,000 crore for the year CY24. Despite facing a global decline of 2%, Grundfos India has managed to maintain a solid growth rate of 11%, according to Saravanan Panneer Selvam, the Senior Regional Sales Director of Commercial Building Services (CBS) at Grundfos India. Selvam noted that the Indian pump industry has been steadily growing at a CAGR of 6.5-7.5% over the past three years, outpacing the global market.
A Bright Outlook for India’s Pump Industry
In a recent interview, Selvam expressed his optimism about India’s future growth trajectory compared to the global market. While Grundfos has experienced sluggish growth in Europe and China, leading to a 2% decline globally, India has emerged as a beacon of growth with an impressive 11% expansion. Selvam emphasized the pivotal role India is poised to play in Grundfos’ global revenue over the next decade, underscoring the company’s commitment to the Indian market.
Localisation Efforts and Manufacturing Milestones
As part of its strategic initiatives, Grundfos India is intensifying its efforts towards localisation, with 40% of its production now being carried out in India. The company is steadfastly working towards increasing local production by a few percentage points annually, with a target of achieving 50% localisation in the near future. Operating two manufacturing plants in Ahmedabad and Chennai, Grundfos India not only serves the domestic market but also exports components to other regions, showcasing its global reach and impact.
Navigating Global Supply Chain Risks and Expansion Plans
In response to the challenges posed by global supply chain disruptions, Grundfos is proactively expanding its manufacturing footprint in multiple countries. With 17 manufacturing plants worldwide, the company has been diversifying its sourcing locations to mitigate risks associated with geopolitical tensions. Selvam highlighted the impact of the Red Sea conflict on Grundfos’ supply chain, causing delays in deliveries to India and the Far East. While the situation has improved, such risks continue to loom large, prompting Grundfos to explore new expansion opportunities.
Rising Demand in Data Centers Cooling Segment
In addition to its core business, Grundfos is witnessing a growing demand in the data centers cooling segment, which is expected to make a significant contribution to the company’s revenue in the coming years. Selvam noted that data centers accounted for 1% of Grundfos’ business last year, but this figure has now surged to 4%, with further growth anticipated. The company is optimistic about this sector’s growth potential, projecting a double-digit contribution within the next one to two years.
In conclusion, Grundfos’ ambitious growth targets, coupled with its strategic initiatives and commitment to localisation, underscore the company’s resilience and adaptability in the face of evolving market dynamics. As India emerges as a key market for Grundfos, the company’s expansion plans and focus on innovation position it for sustained success in the years ahead.