The Pran-RFL Group is going to increase its annual refrigerator production capacity to nine lakh units from the current three lakh as the company has secured Tk215 crore loan assistance from British International Investment.
Currently, the business conglomerate manufactures more than 50 types of refrigerators under the Vision brand name.
An official of the company said it will soon start producing more fridges, installing new machinery at its new facility in Danga Industrial Park of Narsingdi.
To this end, the business group has already received the loan assistance from the development finance arm of the government of the United Kingdom, he said.
Ahsan Khan Chowdhury, chairman and chief executive officer of Pran-RFL Group, told The Business Standard (TBS), "The facility will help boost local manufacturing and cater to the increasing demand for electronics products from the fast-growing, increasingly urban, middle-income population of Bangladesh."
The refrigerator market in Bangladesh has been growing rapidly for almost two decades. The rapid development of a middle and upper class, the growing number of small families and female workers, and a suburbanisation with electrification in rural areas, has effectively increased demand for refrigerators.
The market for this electronic home appliance has also expanded, riding on the ability of people to buy cheaper locally-made refrigerators, with buyer-friendly arrangements in rural areas.
According to a study in 2022 by Marketing Watch Bangladesh, 35 lakh refrigerators sold in the country last year, a growth of more than 15%.
The refrigerator market in the country is now dominated by local brands and 65% of market share is Walton's alone. The remaining market share is largely held by local brands like Jamuna, Marcel, Vision, Minister.
Among foreign brands, Konka, Singer, Sharp, Samsung, and LG are notable.
Pran-RFL officials say their new and greater production capacity will meet the country's growing demand for refrigerators as well as increase its market share. The new plant will employ more than 600 people and the group itself currently employs 1.4 lakh people directly.
In addition to refrigerators, Pran-RFL also has plans to manufacture small home appliances at the new plant, including Vision brand rice cookers and blenders, officials said.
Regarding their loan, Pran-RFL officials said the interest rate on foreign loans for a period of seven years will be 3.75%. The company will start repaying 18 months after receiving the loan.
Rehan Rashid, country director for Bangladesh at British International Investment (BII), said, "This investment in RFL demonstrates BII's commitment to continue backing the growth of an ambitious partner that is making strong strides toward accelerating productivity in the country and creating inclusive economic opportunities in the form of jobs for women and the semi-skilled."
British High Commissioner to Bangladesh, Robert Chatterton Dickson, said, "I am delighted that British International Investment is more than doubling its investment in Pran-RFL."
"BII is central to the UK's new international development strategy and it is delivering honest and reliable investment that creates jobs and supports economic development in Bangladesh," he added.