Imagine a company that keeps your home cool, your meals warm, and your investment portfolio even hotter. Meet EPACK Durable Limited—a silent champion that’s quietly revolutionising India’s manufacturing landscape.
Listed on January 30, 2024, EPACK has already doubled investors’ wealth within just ten months. But this isn’t a flash-in-the-pan success story. With a commanding 24% market share in the Indian room air conditioner (RAC) ODM space and aspirations to scale its top-line to US$ 1 billion by FY28, EPACK is scripting a narrative of exponential growth. So, what’s fuelling this meteoric rise? Let’s unpack EPACK.
What EPACK Durable Does?
Every great story starts with a solid foundation, and EPACK’s lies in its evolution. Founded in 2003, the company initially worked as a contract manufacturer. But by 2012, it had transformed into an Original Design Manufacturer (ODM), crafting its destiny in two core areas:
Room Air Conditioners (RACs):
From sleek split ACs to compact window units, EPACK offers a wide range of air conditioning solutions with energy-efficient features and advanced designs.
Small Domestic Appliances (SDAs):
Think induction cooktops, mixer grinders, and water dispensers—products that make homes run smoother and lives easier.
Components:
With heat exchangers, copper tubing, and PCBAs, EPACK doesn’t just assemble; it builds from scratch, catering to in-house needs and other manufacturers.
Manufacturing Backbone:
The heart of EPACK’s operations lies in its vertically integrated facilities at Dehradun, Bhiwadi, and Sri City. Together, these units produce millions of RACs, SDAs, and components annually, making EPACK a key enabler for brands like Blue Star, Daikin, Voltas, and Godrej.
Growth Drivers: The Organic Roots of Success
What makes EPACK more than just another manufacturer? The answer lies in its ability to ride multiple tailwinds while staying grounded in its core competencies.
Government Backing:
The PLI (Production Linked Incentive) scheme is a nudge from the government for companies like EPACK to reduce import dependency and boost domestic production. With its strong manufacturing capabilities, EPACK is perfectly positioned to benefit.
Untapped RAC Market:
Did you know that only ~8% of Indian households have air conditioners? As climate change cranks up the heat and incomes rise, this market is primed for explosive growth.
Riding the Consumption Boom:
With its portfolio targeting the B2C segment, EPACK aligns directly with India’s growing appetite for convenience-driven products.
EPACK’s story so far has been one of organic growth—methodically building capacity, expanding its product lines, and strengthening client relationships. But what happens when you add a game-changing partnership into the mix?
The Hisense Deal: A Billion-Dollar Turn
Great stories need a twist, and for EPACK, it came in the form of a blockbuster deal with Hisense India. In October 2024, EPACK signed an agreement to manufacture air conditioners, washing machines, and refrigerators for the global brand.
Here’s what makes this deal a headline-grabber:
Phase-1 Investment: Rs. 250 crore to set up a dedicated facility in Sri City, Andhra Pradesh.
Revenue Upside: Rs. 2,500 crore annually by FY28, driven by 1 million air conditioners and 500,000 washing machines.
Scaling Ambitions: Plans to increase AC capacity to 1.5 million units in subsequent phases.
With production starting in June 2025, this deal not only cements EPACK’s domestic dominance but also opens doors to global markets. Additionally, this significantly helps the company closer to its billion-dollar revenue goal by FY28.
The Balancing Act: Shifting Gears
EPACK’s heavy reliance on RACs, which contribute 80% of revenue, has been a double-edged sword. While it drives volumes, RACs are lower-margin products compared to SDAs.
The company is now rebalancing its portfolio to shift RAC dependency to 60%Â and increase SDA contributions. Upcoming launches, like air fryers and fully automatic washing machines, are part of this strategy. Not only do these products promise higher margins, but they also cater to year-round demand, unlike seasonal RACs.
Financials: Numbers that Tell the Story
Let’s get down to the nitty-gritty:
Revenue Growth:
EPACK reported a ~25% CAGR from FY21 to FY24, with revenue reaching Rs. 1,350 crore in FY24. FY25 is set to see a 45%-50% growth to Rs. 2,000 crore, propelled by organic expansion and the Hisense deal.
EBITDA Growth:
From Rs. 44 crore in FY21 to Rs. 108 crore in FY24, EBITDA grew at a robust ~40% CAGR. For FY25, EBITDA is projected to hit Rs. 160 crore.
Margins:
EBITDA margins improved from 6% in FY21Â to 8% in FY24Â and are expected to sustain at this level.
Aspirations:
By FY28, EPACK aims for Rs. 8,500 crore (US$ 1 billion) in revenue, a 6x leap from FY24 levels.
Navigating Challenges: Weathering the Heat
Every growth story has its hiccups, and EPACK is no exception.
2Q Margins Dip:
Margins fell from 4.17% in 2QFY24Â to 2.36% in 2QFY25Â due to higher RAC contributions during an extended heatwave. While seasonal demand skewed the mix towards lower-margin products, the company has maintained its guidance of 8% EBITDA margin for FY25, underscoring the transient nature of this challenge.
Underutilisation at Sri City:
Operating at just 10% capacity in 2QFY25, the new facility inflated fixed costs. However, as production scales up with new product launches, these initial inefficiencies are expected to normalise.
Import Dependence:
Despite manufacturing 75% of components in-house, EPACK remains exposed to forex volatility for critical imports like copper and compressors With localisation efforts gaining traction, this dependency could reduce over time.
While these challenges dampen short-term results, many, like capex and manpower investments, are steps towards building a stronger, more efficient EPACK for the future.
Packing UP!
EPACK Durable isn’t just another ODM; it’s a prominent domestic manufacturer in the making. With organic growth driven by tailwinds, a critical Hisense partnership, and a roadmap to diversify into higher-margin products, EPACK is scripting a high-growth narrative that’s hard to ignore.
Whether you’re tracking India’s manufacturing resurgence or looking for the next big consumption play, EPACK’s journey from Rs. 2,000 crore in FY25 to Rs. 8,500 crore in FY28 is one you’ll want a front-row seat to.
So, the next time your air conditioner hums or your induction cooktop buzzes, remember EPACK Durable—the company powering comfort and growth alike.
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