Aeroflex Industries has announced a Rs 202 crore investment to expand its manufacturing capacity, with the company expecting the expansion to generate Rs 500 crore to Rs 550 crore in additional annual revenue at peak capacity utilisation. 

The investment will strengthen its stainless steel hose, braiding, assembly and liquid cooling businesses, with a focus on growing demand from data centres and artificial intelligence infrastructure. The projects are scheduled for completion by March 2028.

The company plans to invest Rs 124 crore in its stainless steel (SS) hose and braiding division and assembly operations. Its annual manufacturing capacity for hoses and braids will increase from 20 million metres to 30 million metres.

Aeroflex also plans to establish a new assembly plant to convert around 70% to 75% of its hoses and braids into assemblies. This move is expected to help the company offer more value-added products to customers.

The remaining Rs 78 crore will go towards expanding its liquid cooling SFN skid assemblies division. Annual capacity in this segment will increase from 15,000 units to 30,000 units, doubling the company’s production capability. Both projects will be implemented in phases by March 2028.

Aeroflex is positioning itself to benefit from rising investment in data centres and advanced computing infrastructure. As AI workloads increase, data centres require more effective cooling systems to manage the heat generated by high-performance servers.

Liquid cooling solutions can help manage these higher thermal loads, creating opportunities for suppliers of specialised hoses, assemblies and cooling equipment.

The planned capacity expansion is intended to help Aeroflex meet this demand while strengthening its manufacturing capabilities across its existing and emerging product lines. The expected revenue contribution, however, will depend on customer demand, production ramp-up and utilisation levels.

Aeroflex plans to finance the Rs 202 crore investment through a combination of internal accruals, equity and bridge loan financing. 

This approach will allow the company to fund its expansion through multiple sources, although the final impact on its finances will depend on the funding mix and project execution.

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