Sri City, a Special Economic Zone in Andhra Pradesh, is quickly emerging as India’s leading air-conditioner manufacturing hub—and LG Electronics is poised to play a central role.
According to the Times of India, the industrial zone currently hosts seven AC manufacturers and 17 component suppliers. With ongoing expansions and new investments, Sri City is expected to produce roughly 60% of India’s domestic AC supply and 80% of the country’s exports in the sector.
“Over 20 component makers, including LG Electronics and Daikin, have already set up operations here,” said Ravindra Sannareddy, founder and managing director of Sri City. “With support from the central government’s Production-Linked Incentive (PLI) program and state policies, our goal is to create a fully integrated HVAC ecosystem and become the world’s largest AC manufacturing hub.”
LG broke ground on its third Indian factory in June, following existing plants in Noida and Pune. The Sri City facility will begin pilot production of air conditioners by late next year and expand to washing machines, refrigerators, and AC compressors by 2029. Unlike traditional assembly plants, this facility will produce core components, strengthening Sri City’s position as a key node in India’s appliance supply chain.
The area has already attracted global players. Daikin, in partnership with Taiwan’s Reichi, produces compressors for both local and international markets. Other manufacturers, including Pack, are expanding into refrigerators and washing machines, while U.S.-based Carrier is reportedly in talks with Andhra Pradesh officials about potential investment.
Industry analysts say LG’s entry could shift the industry’s center of gravity in India. With large-scale investment and advanced technology, LG is expected to accelerate supplier inflows, enhance local production capabilities, and cement Sri City’s role in the global HVAC value chain.
