BHEL gets 94% of new orders from pvt sector

PSU says it’s winning back contracts that went to Chinese firms

Bharat Heavy Electricals Ltd (BHEL) says private power producers, which were predominantly buying equipment from Chinese companies, are turning to it in a big way.

Speaking on the sidelines of the 20th annual conference of the Indian Nuclear Society, BHEL Chairman and Managing Director B P Rao said the company had bagged orders worth Rs 30,000 crore between April 2009 and December 2009 for erecting 11,700 Mw of capacity. Of these, 11,200 Mw were from independent power producers (IPPs), constituting about 94 per cent of the order book.

“The majority of them (IPPs) used to give these orders to Chinese companies,” he said. “Equipment performance and competitiveness is helping BHEL to win back these orders.”

However, Rao would not name the IPPs who had switched from Chinese companies to his.

Until now, Chinese competition has not been of much concern to BHEL, since the bulk of power capacity additions have been by public sector units, who invariably buy from BHEL. According to research by Crisil and Asian Markets Securities, of the 73,462 Mw of equipment orders placed during the 11th Plan till date, 58 per cent has gone to BHEL, while 21 per cent each has gone to Chinese and other international players.

Recently, however, S Seshadri, member, Central Electricity Authority, said of the 12th Plan target for addition of 100,000 Mw, the bulk is likely to come from private players. Industry reports said private players prefer Chinese equipment, due to timelier delivery and also being about 20 per cent cheaper than BHEL.

BHEL’s equipment performance has been consistently two per cent higher than the competition; other operational parameters are also superior, he said. “With these performance parameters and also our competitive rates, most of these (IPP) customers are coming back to us again.”