Reliance Industries’ Mukesh Ambani, last Thursday announced in the company’s annual general meeting (AGM) that the company will invest Rs 75,000 crore in clean energy business over the next three years.
It aims to set up 100 GW of solar power generating capacity by 2030. What does this mean for the sector, MS Unnikrishnan, former Managing Director at Thermax explained to CNBC-TV18.
He pointed out that RIL in the solar space is planning to build up from scratch.
“This will be the largest capacity in India with a multi-billion dollars investment. Very clearly, they have mentioned that this focused a lot more on roof tops, though they may also be selling normal solar IP,” he said.
The first part is how the engineering is going to be done for all these factories and this might augre well for the construction heavy weights.
“These are all new technologies. The entire plan in building, which will be comprising mainly around 25-30 percent of the total expenses presumably, which is equivalent to Rs 20,000-25,000 crore will go to construction companies.
Unnikrishnan is also skeptical about supply capacity.
“Though he (Mukesh Ambani) has very clearly mentioned that possibly Reliance Jamnagar will supply from existing capacity, I don’t think that will be sufficient,” he said.
There are at least 10 companies that are already in the solar roof top segment, he added pointing at the competition. Moreoever, with effect from April 1, FY22, there is 40 percent import duty on solar panels in India and this makes manufacturing, at least partly, compulsory in India.
“I would say a part may come from outside India… I would presume that Rs 30,000-40,000 crore worth of the orders for Indian companies for capital equipment, and Rs 14,000-15,000 for construction and building making,” he added.
Source: cnbctv18
