Kone India sets up a Rs 450-cr unit in Chennai

A Finnish company, Kone Elevator's Indian arm has established a new modern factory near Chennai of worth Rs 450 crore (US$ 64.39 million) for the consolidation of its manufacturing operations and to prepare for the future growth in India.

The inauguration was done on Tuesday, by the Governor of Tamil Nadu Banwarilal Purohit in the presence of Ministers of Finland and Tamil Nadu apart from the top officials of Kone Corporation. New factory is located at Phillaipakkam in Sriperumbudur industrial corridor near Chennai.

The new unit has been set up over an area of 50,000 sq. mt. and will employ around 600 people. This unit is the largest elevator production of Kone in this region. It will have capability to produce more than 50,000 units annually. All the company's elevators and escalators will be produced in the new production facility and the existing unit of Kone will be decommissioned.

"India is a very important market for us and is also the second-largest for elevators by volumes after China. The new factory will meet the demands of India and neighbouring regions/countries such as West Asia, South-East Asia, Nepal, Bhutan, Bangladesh and Sri Lanka," Mr. Henrik Ehrnrooth, Chairman of Kone Corporation, said during the inauguration.

Currently, the company is growing at single digit because of the slowdown in the realty sector. However, affordable housing and other commercial projects along with infrastructure projects like smart cities and metros are expected to contribute in the demand for elevators and escalators.

Presently, the residential market accounts for 65-70 per cent of company's sales whereas the rest is contributed by hospitality and other commercial projects, said Mr. Amit Gossain, Managing Director of Kone India.

The Company also runs their R&D centres in Chennai and Pune with the workforce of 500 people.

India’s elevator market is expected to reach at 65,000 units per year and escalator market is estimated at 2,500 units annually.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.