Thermax to look at partners for renewable energy business

The Thermax Group would look at working with partners to ramp up the renewable energy arm, First Energy (FEPL) business. FEPL is into solar, wind and solar wind hybrid energy and is part of the green solution-focused portfolio Thermax was building.
Ashish Bhandari, managing director and CEO, Thermax, said the company had committed to invest around $ 100 million (Rs 700-800 crore) in the FEPL business. For ramping up the business beyond this level, they would be looking at external partnerships, Bhandari said.
“There is some clarity as we continue to grow that we should get an external partner to come into the business if the demand continues to be as strong as it was at the moment. The Thermax limit of US $100 will continue to hold. We will not want to invest beyond that particular area because we see a lot of other areas to invest in,” Bhandari said. The company would look to bring in partners in this business in the next six to 12 months, he said.
The company was continuously executing and continued to see strong interest in the FEPL offerings. “We are limited by our ability to execute projects in terms of how big we can grow. We are increasing capacity and executing projects continuously on FEPL,” he said. This business would grow from Rs 200 crore to Rs 400 crore.
The company had invested an additional Rs 200 crore debt and equity in FEPL during the quarter. The other areas Thermax was looking at investing in were in their chemical business and in the hydrogen segment. In the industrial segment, the company could be looking at M&A in adjacent areas.
Thermax subsidiary company, Thermax Onsite Energy Solutions (TOESL) was into outsourced utilities such as steam, heat, chilled water, treated water, power and solar through the Build-Own-Operate (BOO/T) business model. With order pipeline growing and good execution, TOESL too could need investment in the Rs 40-50 crore range, Bhandari said.
TOESL commissioned an 8 TPH green steam supply plant in Gujarat. The company also inaugurated two briquetting facilities in Maharashtra to process nearly 600 TPM of agro-waste, contributing to the green steam portfolio.
FEPL was executing projects in Maharashtra and Tamil Nadu. During the quarter, FEPL executed contracts with a chemical company in Maharashtra for developing a 15.5 MWp solar power project under open access. A 56.85 MWp solar power of solar-wind bundled project (90 MWp solar + 39 MW wind) was commissioned in TN under open access.Bhandari reiterated the company’s intention to stay away from large thermal projects and focus on the RE segment and be part of the energy transition business. The company saw a slow Q2 when it came to large projects. Bhandari remained bullish about prospects in H2FY24.
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