Why Samsung and LG Are Betting on India's Cooling Market

Why Two Consumer Electronics Giants Care About Air Conditioning

Samsung Electronics and LG Electronics are pushing aggressively into India's HVAC (heating, ventilation and air conditioning) market. On the surface this sounds like a story about selling more room air conditioners. It isn't. The real battleground is commercial and industrial HVAC — chillers, system air conditioners, and the cooling infrastructure that sits inside buildings and factories.

Both Korean companies have spent the past few years elevating HVAC from a product line into something closer to a standalone business pillar. The logic is straightforward: smartphones and TVs are replacement-cycle businesses under brutal price pressure from Chinese competitors. Building HVAC, by contrast, is installed once and generates a decade or more of service, parts, and retrofit revenue. It is a B2B infrastructure business wearing a consumer-brand jacket.

Two Reasons India Became the Test Case

The first reason is the obvious one. India has 1.4 billion people and an air conditioner penetration rate still in the single digits to low teens — one of the largest untapped cooling markets on earth, with rising incomes and rising temperatures pushing in the same direction.

The second reason is newer and, arguably, more interesting: AI data centers.

The Data Center Cooling Wave

According to KOTRA, the Korea Trade-Investment Promotion Agency, India's data center IT capacity is expected to expand from roughly 1.5GW in 2025 to 8GW by 2030 — more than a fivefold increase in five years. Global hyperscalers and Indian conglomerates have both announced large-scale investments, turning Mumbai, Chennai, and Hyderabad into emerging hubs.

Here's the part that matters for HVAC vendors: in a data center, a large share of total electricity consumption goes not to the servers themselves but to removing the heat they produce. GPU racks built for AI training and inference draw several times the power of conventional servers, which pushes thermal density past what traditional air-cooled setups can comfortably handle. Liquid cooling and high-efficiency chillers stop being optional.

India compounds this. Much of the country runs hot year-round, meaning free cooling is largely unavailable — operators can't lean on cool outside air the way Nordic or northern European facilities do. Higher ambient temperatures mean higher cooling loads, which means bigger, more expensive mechanical systems. India's data center boom is, in effect, a large industrial HVAC order book.

Different Playbooks

LG has been building toward this longer. It operates local manufacturing in India, has invested in training facilities for local HVAC engineers, and has steadily expanded its chiller and system air conditioner lineup. Its move to list its Indian subsidiary on the local stock exchange fits the same pattern — localizing capital and brand identity rather than operating as a foreign importer.

Samsung leans on a different set of assets: decades of experience running the massive cooling systems inside its own semiconductor and display fabs, plus its SmartThings platform for integrated building control. Its acquisition of a European HVAC business also matters indirectly, because in this industry installed reference projects are the currency of credibility. Winning a large chiller contract is less about brand recognition than about proving you've done it before.

The Obstacles Are Real

India's HVAC market is not empty. Daikin, Carrier, and Johnson Controls are entrenched, and domestic players like Voltas and Blue Star have deep distribution and service networks. Industrial HVAC in particular is judged on design, installation, and service capability rather than product specs alone — consumer brand strength does not transfer cleanly. The practical barrier to entry is the depth of your local contractor and maintenance network, which takes years to build.

India's manufacturing incentive schemes, including the Production Linked Incentive program, cut both ways. They reward local production but come attached to localization requirements and pricing pressure. And data center projects themselves frequently slip against schedule because of power grid constraints and land acquisition — a reminder that an 8GW forecast is a forecast, not a purchase order.

The Bigger Picture

Reading this purely as an emerging-market expansion story misses half of it. Korean appliance makers have been squeezed from two directions: low-cost Chinese competition on one side, saturated demand in developed markets on the other. Their answer has been a pivot toward B2B infrastructure, and HVAC is the clearest expression of that shift.

AI data centers give that pivot both a justification and a deadline. Cooling isn't a glamorous corner of the AI buildout the way chips or power generation are, but it is one of the most reliable beneficiaries of it — every watt of compute deployed creates a corresponding watt of heat someone has to remove. How Samsung and LG perform in India over the next few years will say a great deal about whether that pivot actually reshapes their earnings.

Sources

• Samsung and LG target India's HVAC market amid AI infrastructure boom (IT Chosun, Korean)