Shree Refrigerations sees Rs 4,000-5,000 crore ship market

Shree Refrigerations Limited said on October 30, 2026 that it sees a Rs 4,000 crore to Rs 5,000 crore shipbuilding market for heating, ventilation and air-conditioning (HVAC), air-conditioning and refrigeration over two years, based on estimated opportunities of Rs 2,750 crore in defence and Rs 2,500 crore outside defence. Management did not disclose the share Shree Refrigerations expects to convert into orders.

How large is Shree Refrigerations’ shipbuilding market opportunity?

Shree Refrigerations estimates that shipbuilding, including new construction and retrofit work, represents a Rs 4,000 crore to Rs 5,000 crore market over two years. Management based the estimate on naval programmes and commercial shipbuilding activity, rather than on Shree Refrigerations’ existing order book. It said more than 200 ships are being built by 2032 and 230 to 250 ships have approvals by 2035.

For defence, management cited financial approvals of about Rs 2.75 lakh crore and estimated HVAC, air-conditioning and refrigeration equipment content at about 1%, or Rs 2,750 crore, over the next two years. Management described the ship numbers and approvals as information available in the public domain. The estimate is a measure of addressable equipment demand, not a disclosed tender pipeline or contracted revenue figure for Shree Refrigerations.

For non-defence shipbuilding, management said the visible number of ships had increased from 400 to 475. It estimated its relevant equipment opportunity at about 0.5%, or Rs 2,500 crore, because commercial-vessel configurations differ from naval platforms. The two component estimates add to Rs 5,250 crore, while management presented the combined market as a Rs 4,000 crore to Rs 5,000 crore range and did not explain the difference.

Why does Shree Refrigerations believe it can pursue this market?

Shree Refrigerations said its naval HVAC, air-conditioning plant, refrigeration plant and electrical control-panel capabilities support its pursuit of the market. Management said it has operated in defence manufacturing for more than 10 years and employs more than 370 people across eight locations. It also said it is the only company in its product range that manufactures its own electrical control supply, which management described as control over the value chain.

Type testing is a key mechanism for naval equipment because products must qualify before they can be supplied to a naval platform. Shree Refrigerations said five of the six air-conditioning plant capacities standardised by the Indian Navy are already type tested. Management said this would allow production to begin immediately for relevant orders without repeating the time and cost of type testing.

Shree Refrigerations also said about 75% of components used in its HVAC systems are type tested. Some components for expected future projects may still require testing, according to management. The company’s revenue sources include equipment for new-build and retrofit work, spares, installation, commissioning and lifecycle service support, meaning the opportunity is not limited to original equipment deliveries.

What live projects and facilities support Shree Refrigerations’ execution?

Shree Refrigerations said it has nearly 10 live naval projects, including a fleet support ship assignment covering HVAC, air-conditioning and refrigeration plants. Management described that project as a turnkey delivery. It also said the associated refrigeration plant is the largest such plant the Indian Navy has bought, although it did not disclose the project value, delivery schedule or revenue recognition status.

The company has expanded manufacturing space to about 70,000 square feet, comprising a new 50,000-square-foot Unit 2 and an existing 20,000-square-foot unit. Management said land for a further 50,000 square feet has already been levelled and would require construction of a shed. No capital-expenditure amount, approval date or completion target was disclosed for that potential addition.

Shree Refrigerations said its production set-up includes a paint booth, laser cutting, bending and a robotic welding line, allowing raw material to move through an integrated manufacturing process. The existing 20,000-square-foot Unit 1 is being converted into a testing facility. Management cited a controlled-ambient air-conditioning test room and testing equipment that can run an air-conditioning plant in a tilted position to simulate ship movement.

How does service capability add to Shree Refrigerations’ position?

Shree Refrigerations said it maintains dedicated service teams at almost all Indian Navy ports, while its Delhi office is focused on business development. Management said it does not cross-deploy or cross-fly service teams between locations, aiming to support naval equipment through its lifecycle. This service model covers installation, commissioning and maintenance alongside equipment supply.

The company is an authorised service partner for Danfoss Turbocor compressors, according to management. Shree Refrigerations said more than 100 chillers containing more than 200 such compressors are operating in the Indian Navy. Management said repairs that were initially sent to the United States can now be undertaken in India through its authorised service capability.

Management also linked this capability to potential cooling demand outside naval platforms. It said magnetic-bearing-based chiller technology is gaining use in industrial cooling and data centres, while cautioning that associated service volumes would initially be insignificant. Shree Refrigerations had no data-centre order as of the October 30, 2026 call and said it would initially source products from an Australian partner rather than manufacture them in India.

What do H1 FY27 results and orders show about current activity?

Shree Refrigerations reported nearly Rs 100 crore of revenue in H1 FY27, about 85% higher than H1 FY26. Earnings before interest, tax, depreciation and amortisation (EBITDA) margin increased to 13.5% from 11%, despite commodity-inflation pressure, according to management. Management expects EBITDA margin of around 22% for FY27, which is guidance and not a reported result.

The order book stood at about Rs 200 crore at September 2026, compared with Rs 270 crore at the start of FY27. Management linked the decline to execution and said naval platform orders are generally released from August to February or March. It expects to add orders continuously during the balance of FY27 and to finish the year with a healthy order position, without providing a numerical target.

Working-capital balances increased during H1 FY27. Inventory rose to Rs 80 crore from Rs 54 crore, which management said reflected strategic procurement for H2 deliveries and margin protection. Trade receivables increased to Rs 128 crore from Rs 105 crore, while management said trailing receivable days were 252 days; it also cited higher short-term borrowing and cash-credit utilisation in current liabilities.

Conclusion

The Rs 4,000 crore to Rs 5,000 crore estimate sets out the market scale that Shree Refrigerations believes it can address through naval product qualifications, nearly 10 live projects, 70,000 square feet of manufacturing space and service teams at Indian Navy ports. H1 FY27 revenue of nearly Rs 100 crore and the Rs 200 crore September order book show ongoing execution, but they do not establish the company’s eventual share of the stated shipbuilding opportunity.

The next disclosed milestones are order inflows during the naval ordering period that management identified as August through February or March, and H2 deliveries supported by Rs 80 crore of inventory. Management also plans for the possibility of another 50,000 square feet of factory space, while data-centre revenue remains unresolved because Shree Refrigerations had no order in that segment and excludes it from its FY27 guidance.