To boost its revenues from other businesses, power equipment major Bharat Heavy Electricals Ltd (BHEL) is betting big on transportation, renewable energy and water businesses.
The company, which had recently tied up with multinationals, is now planning to join hands with Indian Railways for setting up manufacturing units. On the renewable energy front, the company is planning to set up a photovoltaic module plant, for which it has done financial closure, according to the company’s chairman and managing director.
Speaking to reporters after inaugurating new production bays at its Ranipet unit, BHEL CMD B Prasada Rao said, “Transportation is the next big opportunity we see for the future growth”. Currently, the segment contributes around Rs 1,000-1,200 crore to the total business, he noted.
Recently, BHEL has secured orders from Indian Railways for the development, manufacture and supply of three-phase IGBT-based propulsion systems for electric locomotives and AC EMUs (electric multiple units), hitherto the domain of leading multinational corporations. The Rs 300-crore orders are for 40 sets of 1,400 hp AC EMUs and 30 sets of 6,000 hp electric locomotives. The company has tied up French multinational Alstom.
“We are now planning to bid for two more factories, along with Alstom,” he said. BHEL is already executing an order for 200 numbers of 5,000 hp 25kV AC mainline electric locomotives (Type WAG-7) for Railways. Besides, the company had also tied up with GE for diesel engine and was now planning to tie up with Indian Railways to set up manufacturing facility for EMUs and diesel engines, he said.
The other area in which the company is betting big is renewable energy, said Rao. The company bagged contracts for setting up three eco-friendly grid-connected solar power plants with a cumulative capacity of 6 Mw on a turnkey basis, as part of the National Solar Mission.
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The orders, valued at over Rs 78 crore and envisaging the setting up of three grid-connected solar PV plants of 2 Mw each, have been placed by Indiabulls. BHEL will design, manufacture, supply, install and operate and maintain one solar power plant at Bareilly in Uttar Pradesh and two solar power plants near Nagpur in Maharashtra.
“We are now planning to set up a manufacturing unit for photovoltaic modules along with BEML with a capacity of 250 MW. This would attract an investment of around Rs 1,500-2,000 crore. We have got a 25 per cent capital subsidy and financial closure is also done.”
On water business, he said BHEL signed agreement with GE Water under which its Ranipet unit would work on water treatment system. Through this joint working, the unit would be able to acquire the capability of designing and building RO (reverse osmosis)-based desalination systems. “We expect Rs 400-500 crore from the water business,” said Rao.