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The objective of this study is to investigate thermal–hydraulic characteristics of an air cooled condenser and optimized the design in terms of heat transfer per unit pumping power, area goodness factor, volume goodness factor and material requirement using the 3D numerical simulations. The annular-finned tubes have been considered in this study, which is one of the most common type of fin used for the design of air cooled heat exchangers and known to provide a high heat transfer coefficient per unit pressure drop. The effect of tube shape (elliptical and round), tube diameter [7–24 mm (circular), 30 × 10–30 × 20 mm (elliptical)], fin spacing (2–10 mm), number of rows (2–10), fin height (5–10 mm), air frontal velocity (4.76–6.32 m/s), transverse tube pitch (36.8–44 mm) on the thermal–hydraulic performance has been studied. It is observed that, with an increase in the fin spacing, the heat transfer coefficient increases (by 35–40%) at a constant inlet velocity and the pressure drop decreases (by 60–80%). The frontal area requirement increases by 100–150% with an increase in the fin spacing for the same heat removal capacity. As the row number is increased, the heat transfer coefficient increases initially for N r < 4 by 7–8%, and for N r > 4, the heat transfer coefficient decreases by 23%. An increase in the tube pitch increases the heat transfer coefficient per unit pressure drop by 40%. The fin efficiency is found to decrease with an increase in the Reynolds number, fin spacing and number of tube rows. In the last section optimization of the design has been performed based on Taguchi method and numerical results obtained. It has been observed that the number of tube rows must be kept between 2–4, fin spacing 3–5 mm, tube pitch around 40 mm, and fin height 5 mm for better performance of the condenser. [ABSTRACT FROM AUTHOR]