Bhel to invest Rs.200 bn on expansion, diversificationDecember 12th, 2008 - 6:21 pm ICT by IANS
Chennai, Dec 12 (IANS) Power equipment major Bharat Heavy Electricals Ltd (Bhel) will pump in around Rs.200 billion (Rs.20,000 crore) on brownfield expansions and joint ventures, said a top company official. “We will be investing around Rs.20,000 crore (Rs.200 billion) in expanding our existing facilities across the country (brownfield expansion) so as to take our total capacity to 15,000 MW by the end of 2009 and to 20,000 MW by 2011,” Bhel chairman and managing director K. Ravi Kumar told reporters in Tiruchirapalli Thursday.
“The total investment will be made from our internal accruals,” he added.
The company will enter into joint ventures with foreign for making castings and forgings, railway locomotives, transmission products, nuclear reactors, photo-voltaic cells, oil rigs and also with domestic power generation companies like National Thermal Power Corp (NTPC) and state electricity boards (SEBs) in setting up power plants.
Bhel is also in talks with Japanese and European companies manufacturing large sized castings and forgings (over 40 tonnes) for a joint venture so as to enter the nuclear power sector.
“We would like to have majority stakes in the castings and forgings venture. The idea is to have a port based plant - in Visakhapatnam or in Gujarat - so as to export 60 percent of the production and the balance for the domestic market.”
The venture, requiring around 420 acres, is expected to involve an outlay of Rs.15 billion and the decision on the joint venture partner is expected to be finalised by March.
The power equipment major partnering with Nuclear Power Corp has floated a tender to select appropriate technology partner for getting into engineering, procurement and construction of nuclear plants.
“We are looking at turbine-generator capacity in the range of 700-1,600MW,” Kumar added.
The company will also be investing Rs.10 billion at its Bhopal facility to make rotors for nuclear turbines.
On the nuclear reactor manufacturing side, Bhel is holding talks with overseas players, he said.
Additionally, in partnership with General Electric of the US, the company will begin manufacturing high powered diesel locomotives for the Indian Railways. “We have already got orders for 50 units,” Kumar said.
Following the signing of joint venture with the Tamil Nadu Electricity Board (TNEB) for setting up a 2×800 MW super critical power plant, he said Bhel will sign similar joint venture agreements with the state electricity boards of Karnataka, Gujarat, Orissa and Madhya Pradesh.
The company will take 26 percent equity stake in the joint ventures with SEBs, he added.
Bhel’s order book position is around 120,000 MW (40 percent of that is EPC and 60 percent boiler-turbine sets). “Eighty percent of the order book is accounted for by power utilities and 20 percent by industries.”
Targeting a growth of 30 percent this fiscal, Kumar said the company will be increase the headcount by 9,000 to 50,000 coinciding with its expansion plans.