Atomberg’s next spin as it prepares for IPO: From selling fans to supplying components

The appliance maker, backed by Temasek, Steadview Capital, and A91 Partners, is scaling its subsidiary Atomberg Innovations to supply critical components such as motors, controllers, and compressors to appliance makers and other manufacturers.

“What we are doing is localising core technologies that historically came from outside India,” Manoj Meena, founder and chief executive officer (CEO), Atomberg Technologies told Mint. “That creates an alternative to the China supply chain."

For a company best known for consumer products, the shift marks a strategic expansion into the enterprise segment and reflects a broader shift in India’s manufacturing landscape.

Many core components used in appliances, particularly motors, compressors and electronic controllers, have historically been imported largely from China. As global supply chains diversify and India pushes for greater localization through policy support and manufacturing incentives, companies dsuch as Atomberg see an opening to build domestic alternatives.

The push into enterprise manufacturing comes at a time when Atomberg is preparing for a public listing this year and is in discussion with investment bankers for the offering, which is expected to be sized at around ₹2,000 crore, according to people familiar with the matter.

Atomberg, founded in 2012, has raised capital upwards of $150 million to date, per Tracxn data. The company was last valued at $450 million when it raised $86 million in 2023.

Enterprise push

For Atomberg, the enterprise push is expected to become a major growth driver, though it currently contributes only a single-digit share of revenue. Meena said the segment could scale quickly as appliance makers look for local suppliers of key components, he added.

“Over the past few years, global appliance brands have been actively looking to diversify their supply chains beyond China. That opens up opportunities for Indian companies that can develop core components like motors, controllers and compressors locally,” said Madhur Singhal, managing partner (consumer and internet) at consultancy Praxis Global Alliance.

The firm reported ₹958.4 crore in operating revenue in FY25, while net losses narrowed 41% to ₹117.4 crore, according to filings with the ministry of corporate affairs.

Through Atomberg Innovations, the company is targeting several verticals, including appliances, automotive, industrial automation, and emerging segments such as drones and medical devices.

The initial focus, however, is on heating, ventilation and air-conditioning (HVAC), a category expected to grow rapidly as India expands domestic manufacturing of cooling equipment.

The Mumbai-based company has developed brushless direct current (BLDC) motors for both indoor and outdoor air conditioner units and recently introduced an indigenous compressor technology, an important cooling system component that has historically been imported.

Atomberg began developing its enterprise offering about two years ago and has spent the past 18 months testing components with large appliance brands, Meena said. Some relationships have begun translating into commercial supply, though revenue contribution remains limited.

The potential market is large. Industry estimates around 30 million air conditioners could be manufactured in India annually by 2030, creating demand for motors, compressors and electronic components used in cooling equipment.

However, industry experts caution that the shift from consumer products to supplying components to manufacturers can be complex.

“Component manufacturing is a very different business from selling consumer appliances. OEM partnerships take time to build because reliability, certification and long-term supply assurance matter far more than branding,” said Praxis Global Alliance's Singhal.

BLDC playbook

Atomberg’s enterprise ambitions are rooted in technology originally developed for its consumer products. The company began commercializing BLDC fans around 2015, initially selling to institutional buyers where energy savings were an important factor before expanding to e-commerce platforms and later offline retail.

Adoption of BLDC fans, which account for roughly 20% of the overall ceiling fan market, is expected to increase as India tightens energy-efficiency standards for appliances, according to Meena.

While fans remain the core of Atomberg’s consumer business, the company has expanded into adjacent categories such as kitchen appliances, water purifiers and pedestal or wall-mounted fans in recent years.

“Companies that own core technologies—whether motors, electronics or control systems—tend to have stronger defensibility in appliances because the differentiation moves beyond just distribution or branding," said Praxis' Singhal.