Category: in the news

DNA | Aug 27, 2009

Thermax and the $6 billion SPX Corporation of the US have entered into a joint venture to provide technology solutions for power plants with a capacity of over 300 mw.

Thermax will hold 51% and SPX the rest in the venture, which will have an initial investment of Rs 25 crore, M S Unnikrishnan, managing director of Thermax, said. The new company will be based in Pune.

The firm will offer air pollution control equipment, which costs about $15-20 million, and has the potential to achieve annual revenue of $50-100 million in five to 10 years, said Drew Ladau, SPX's president of thermal equipment and services.

Thermax already has a technology licensing agreement with Balcke-Durr, a Germany-based subsidiary of SPX, for air pollution control equipment called electrostatic precipitators (ESPs) for up to 300 mw. Thenew JV will benefit from the tie-up.

The venture has lined up supply-chain partners, but may initially need to source some products from SPX's overseas facilities, Unnikrishnan said.

“India is beginning to build large power plants in the super-critical category, which will necessitate increased use of coal as fuel. The new range of the Thermax-SPX ESPs will offer higher efficiencies by tackling the challenge of high ash content in Indian coal,” Unnikrishnan said.

A greener focus is quite profitable, finds Thermax

Business Standard | Decvember 10, 2009

Teams across divisions find immense scope for getting more with less.

From a small boilermaker company to a leader in energy and environment solutions, Thermax's journey is getting greener by the day, with a three-point programme: Reduce, reuse and recycle. Not only is it initiating green activities in-house but also helping its customers conserve energy.

The company estimates its saving from such activities as Rs 17 lakh in 2006-07, rising to Rs 56 lakh in 2007-08 and Rs 82 lakh in 2008-09. This is spearheaded by a Project Ever Lean, in which teams across divisions work on systems and processes to see whow these can be made better. Around 400 employees have been involved. Energy saving devices have been installed, older equipment modified and re-used, and simple steps agreed on like shifting the weekly off from Sunday to Thursday at its facility here —Thursday being the power load shedding day—to avoid using generator backup.

A project is underway for a biogas unit which will convert solid waste from the Chinchwad factory canteen here, reducing use of LPG. It will also make use of a ‘smart' way to watch water consumption, through metering systems and photo sensors for controlling use.

In addition, Thermax has installed a sewage treatment plant for treating and recycling water. The industrial wastewater at its chemical manufacturing plant in nearby Paudh has an effluent treatment and recycling system that uses various technologies, including reverse osmosis to clean and recover water, and boilers modified accordingly to reuse such water.

In a bid to leave a smaller carbon footprint, the company took on another three-point agenda: Elimination, improvement and innovation. Eliminating and streamlining various manufacturing processes like streamlining stress-relieving operations of the furnaces, improving efficiency of current equipment and processes, and innovative methods such as using fuels smartly have all measurably helped.

The company says with pride that clients in over 60 countries have found Thermax's green techniques useful in making their operations leaner. “We have already commissioned plants that generate green energy-equivalent of more than 4,000 Mw of power per hour. Our vapour absorption chillers supplied to customers provide more than one million tonnes of environment-friendly chilling, with water as refrigerant. And, our treatment plants clean 1,000 million litres per day of wastewater,” says M S Unnikrishnan, managing director.

These initiatives have contributed in making operations leaner round the globe and in reducing energy intensity for many industries, it notes. While revenue doubled between 2005-6 and 2007-08, from Rs 1,606 crore to Rs 3,433 crore, carbon dioxide emissions have fallen by four tonnes for each rise of Rs 1 crore, the company said.

Business Standard, November 27, 2009

Industrialisation, technology, urban need make commercial water supply a growing opportunity.

The 47.3-hectare Commonwealth Games Village coming up in Delhi on the bank of the Yamuna will house thousands of athletes next October, in 1,100 flats. Thousands of litres of water will be used every day and these will be recycled supply. The village will have the most advanced water treatment plant using membrane technology.

At Panipat, Indian Oil Corporation (IOC)'s new naphtha cracker project, along with downstream polymer units, is using the latest technology to recycle 150 million litres per day of water required for running the plants.

Down south in Chennai, water-starved Chennai Petroleum Corporation Ltd (CPCL) has commissioned a 26.367 million litres per day (MLD) reverse osmosis-based desalination plant to become self-sufficient in its daily water requirements.

"Siemens India is also planning to enter the water treatment business in a big way in India. A few months ago, the company had launched its water treatment solutions in the country. In the coming years, water treatment will contribute a major share of revenue to our business as many projects from the government and municipal sector are coming up in India," said Armin Bruck, managing director of Siemens India.

Water and wastewater treatment, especially in the industrial and municipal sectors, is becoming big business. The country already has a total commercial water market worth around Rs 10,000 crore, growing consistently at 10-12 per cent in the past four-five years, say industry experts.

The point-of-consumption market, which involves localised treatment of water by setting up distribution channels, is a Rs 1,000-crore one, and is growing at over 20 per cent year-on-year, driven by urbanisation.

Industries in the country require normal to ultra-purified water (as with pharmaceutical companies) and this segment has business to the tune of Rs 2,000 crore, growing at 15 per cent annually. According to government estimates, the total requirement for industrial water in 2025 will grow four-fold to 120 billion cubic metres (bcm), from the current 30 bcm.

In the industrial water segment, the major players are Va Tech Wabagh, Thermax, Ion Exchange, Driplex Water Engineering, Indocan Engineering Systems and Projects and Development India.

“The specialised wastewater treatment for industrial use, which is now a nascent business of Rs 500-Rs 800 crore, will grow big in the coming years, considering our industrialisation. But this will depend on how strictly pollution control norms are enforced,” says M S Unnikrishnan, managing director and chief executive of Thermax Ltd.

The Rs 3,300-crore turnover Thermax has big plans for the water business, which currently contributes about Rs 300 crore to the Pune-based power and pollution control equipment maker's sales. Three months earlier, Thermax had teamed with GE Water of the US to bring GE's ultra-filtration and membrane bio-reactor (MBR) technology for wastewater treatment, reuse and processing of water in India's commercial and institutional sectors. The company also has licensing technology from Germany-based Wehrle-Werk AG to purify industrial wastewater.

Chennai-based Va Tech Wabagh, the industry leader in water and water treatment solutions in the country, with a turnover of Rs 1,200 crore, is also planning big growth in India.

“We expect to grow 50 per cent in the country in the next three to four years organically and evaluating acquisitions to access suitable domestic technologies and assets,” says Rajiv Mittal, managing director.

His recent major projects include the Commonwealth Games Village project, Panipat refinery treatment facilities and part of the Yamuna cleaning.

All experts agree the real growth for the sector will come from the municipal water and wastewater treatment business, mainly dependent on government allocations and funds from agencies like the Asian Development Bank, World Bank and Japan Bank for International Cooperation (JBIC).

What has helped is the infrastructure status for water treatment and supply projects, making these eligible for bank finance and a 10-year tax holiday. That the government has allowed 100 per cent foreign direct investment in the infrastructure sector, including water treatment systems, is another incentive for global players to test Indian waters.

Under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), the fund allocation from the Indian government for improvement of basic services such as water and sanitation in the 2008-09 Budget was Rs 6,865 crore, against Rs 5,482 crore in the previous year. The allocation for JNNURM was stepped up steeply by 87 per cent for 2009-10 to Rs 12,887 crore, which is attracting global players to enter the Indian market. As of May 2009, the government had sanctioned 463 projects requiring an investment of Rs 49,743 crore, mainly for basic urban services like water supply, sewerage and storm-water drainage.

Apart from Va Tech Wabag and Thermax, global players such as US-based major CH2M Hill, the world's largest water company, Veolia Water, and water treatment plant specialist Degremont, have already entered the Indian market.

A few months earlier, Jain Irrigation Systems teamed with Mekorot, the national water company of Israel, to explore projects in India in desalination, water resource management, water supply, municipal water management and wastewater treatment and reclamation projects. Mekorot supplies 80 percent of Israel's drinking water and 70 per cent of its entire water supply, operating 3,000 installations across the country.

“The MoU is yet to proceed to a further business alliance and the partners are yet to finalise the details,” said a source close to Jain Irrigation.

“India has over 3,000 towns and cities and only 200-plus have partial or full wastewater collection and treatment facilities and these cover less than one third of the urban population. This sector has an investment potential of more than $50 million,” said an industry source.

According to Unnikrishnan, at least 100 municipal houses are currently in the process of partly or fully engaging private players to handle water supply and drinking water.

DNA | July 10, 2011

Pune-based Thermax Limited has designed and commissioned a first-of-its kind solar air conditioning system at the Solar Energy Centre in Gurgaon, Haryana.

Union minister for new and renewable energy (MNRE) Farooq Abdullah inaugurated the 100 KW technology demonstration project recently. Union minister of power Sushilkumar Shinde was present.

In this innovative installation, the company has integrated indigenously developed triple-effect chiller and solar parabolic concentrators.

While conventional solar systems take up a large area for limited cooling output, the Thermax project through in-house R&D has achieved a significant space reduction of nearly 30% and a 20% increase in cooling efficiency. This has brought down cost and moved the project closer to commercialisation.

Speaking about the national relevance of the project, partly funded by MNRE, Thermax Ltd managing director and CEO, MS Unnikrishnan, said, “A growing India will consume 35% of its electricity generated only for cooling and air conditioning. So it makes immense sense to use solar energy as a source for cooling, and reduce the use of fossil fuel.”

According to the company, the solar cooling systems operating in various countries, including India, use low and medium temperature solar collectors with single or double effect absorption chillers that work on heat instead of electricity. The solar collectors in the Thermax system have been designed to harness the sun's energy in an effective manner to provide temperatures from 140°C to 210° C. They are effectively integrated with a newly designed triple effect chiller.

Offering the highest COP (coefficient of performance) in global markets today, the new chiller offers a technological breakthrough for solar applications.

The fact that the availability of sun's energy during daytime matches the cooling requirements of commercial establishments makes this application practical and promising. The project can lead the way in substantially reducing the load on the national power grid.

The company has developed its indigenous solar parabolic concentrators through collaborative application research with a host of eminent agencies — Advanced Research Centre for Power Metallurgy and New materials (ARCI), IIT Kanpur, and Fraunhofer Institute from Germany.

The system can also be operated with natural gas to provide continuous cooling during non-sunny hours. This fast-track project has been successfully completed within fifteen months and Thermax would also take care of the operation and maintenance of the installation over the next five years.

Economic Times | April 28, 2011

PUNE: Thermax, a provider of solutions in the energy and environment sectors, is setting up a greenfield plant at Kesurdi, near Shirwal, off the Pune-Bangalore highway, to manufacture supercritical boilers. The plant will be set up by its 51:49 joint venture with Babcock and Wilcox.

With the commissioning of this plant by the last quarter of 2012, Thermax-Babcock Wilcox will become the third player in India to manufacture supercritical boilers, after state-owned Bhel and L&T-Mistubishi JV. The Thermax-Babcock Wilcox JV was announced last March for the manufacture of supercritical boilers which means boilers with configuration of over 600 MW, as well as subcritical boilers over 300 MW. Thermax has also signed a technology transfer deal with Babcock and Wilcox for the manufacture of sub-critical boilers, in the range of 100-800 MW.

Thermax has acquired a 100-acre plot at Kesurdi for the JV with Babcock and Wilcox which will have the capacity, in the initial phases, to make 3,000-MW equipment. It will later scale up, as orders come, to 5,000 MW in subsequent phases. The plant is scheduled to be commissioned by September-December 2012.

An official at Thermax confirmed the location of the JV, adding they do not currently have any orders. "The precondition for an order is a manufacturing plant and the plant at Shirwal is currently under construction," said the official.

Earlier, Thermax had said they were weighing the option of locating the plant either in Gujarat or Maharashtra. The latter was chosen since the supporting infrastructure is already present in the region, with Thermax's corporate headquarters in Pune about 40 km away from the greenfield site.

Speaking to reporters after the company's AGM last year, Thermax chairperson Meher Pudumjee had pointed out the benefits of supercritical boilers, describing them as being more efficient, with lower consumption and lower carbon emissions. "Even a 1% increase in efficiency saves a lot of coal and reduces carbon emissions. That is why a JV with Babcock and Wilcox."

Business Standard| March 1, 2010

Pune-based energy and environment solutions' provider Thermax is gearing up to tap incentives offered in the Union Budget for renewable energy, water and wastewater treatment.

The company is planning a strong foray into solar, biomass and geothermal sources of energy, said M S Unnikrishnan, managing director and chief executive.

He said the company had initiated a solar project at a village in Chakan near Pune, in association with the Department of Science and Technology. The Rs 13-crore investment is to electrify the village using an indigenously developed solar-cum-biomass fuelled technology, through which the village will get electricity round the clock, even during the rainy season when sunlight is scarce.

“This has huge commercial opportunity and there are many villages in India where electricity transmission lines have not reached. Incentives offered by the government can act as a booster to implement the project on a large scale,” he said.

The Union finance minister, in his Budget speech on Friday, had announced an increase in the plan outlay for the Ministry of New and Renewable Energy by 61 per cent, from Rs 620 crore in 2009-10 to Rs 1,000 crore in 2010-11. He also provided a concessional Customs duty of 5 per cent to machinery, instruments, equipment and appliances required for the initial setting up of photo-voltaic and solar thermal power generating units, and exempted all those items from central excise duty.

At the moment, setting up a unit to generate one megawatt (Mw) of solar energy costs more than double that for each Mw of a coal-based thermal power unit.

Unnikrishnan said the Rs 3,500-crore company was also exploring a foray into geothermal energy. The Budget had exempted ground-source heat pumps used to tap geo-thermal energy from basic Customs duty and special additional duty. The incentives will reduce the cost for initiating a project, as geothermal energy is relatively new to India, he said.

Unnikrishnan said Thermax was also looking forward to big business from water, wastewater and sewage treatment, as the government had earmarked higher allocation for infrastructure projects and for the Jawaharlal Nehru National Urban Renewal Mission.

Hindu Business Line | March 10, 2010

Energy and environment solution provider Thermax and US-based Babcock & Wilcox (B&W) have inked a joint venture agreement to manufacture super-critical boilers for the power sector, with an investment of Rs 700 crore. The joint venture looks to set up a manufacturing facility with an annual capacity of 3,000 MW.

Thermax will hold 51 per cent of the equity, which will come from its cash reserves, while Babcock and Wilcox Power Generation Group will hold 49 per cent. The debt-to-equity ratio will be 1:1.

Ms Meher Pudumjee, Chairperson, Thermax, outlining the importance of super-critical boiler technology, said a one per cent rise in the efficiency level of a 300 MW plant would save 15 tonnes of coal per hour. Super-critical units on an average consume 20-30 per cent less coal than sub-critical ones, which in turn results in less carbon emission and lower operating cost.

The super-critical units come in a bigger configuration of over 600 MW, and their larger size offers economy of scale in terms of utilities and raw material.

Mr M.S. Unnikrishnan, Managing Director and CEO, Thermax, said the company had a 22-year-old business relationship with B&W. In February 2008, Thermax had signed a technology transfer deal with B&W for manufacturing sub-critical power boilers, from 100 MW to 800 MW.

Mr Unnikrishnan said that up to 300 MW (sub-critical) units would be taken care of by Thermax's existing facilities and the rest would be transferred to the joint venture company. The joint venture will also manufacture sub-critical boilers over 300 MW. The company is close to finalising the location. The facility is expected to be operational in 24 months.

Mr Richard L Killion, President and Chief Operating Officer, B&W PGG, said: “This joint venture presents substantial opportunities for both. It also augments B&W PGG's presence and profile in the global marketplace and presents a substantial opportunity to continue the growth of our business in India and globally.”

B&W, 140 years old, is a $2.8-billion major that pioneered the development of super-critical boilers. The boilers supplied by the company generate over 3 lakh MW globally.

Thermax's Rs 2 shares closed 2.3 per cent up on the NSE on Wednesday at Rs 671.60.

Hindu Business Line | March 12, 2010

‘Our strength is in high quality manufacturing units, besides heat and mass transfer and project management capabilities.' The Pune-based Thermax and Nuclear Power Corporation of India are working on new packages such as balance of plant (BOP) and allied work relating to secondary portion of nuclear power plants.

“We are working with NPCIL for the new packages that are coming up. NPCIL wants Indian companies to pre-qualify and participate in the construction and we are one of the companies identified. We will also be one of the BOP suppliers in that area. We are not into the main nuclear business [reactor],” Mr M.S. Unnikrishnan, Managing Director and Chief Executive Officer, Thermax, told Business Line.

The tenders for the packages are likely to be floated by NPCIL in the next three to four months.

Thermax is also looking to get into the nuclear components manufacturing business.

Certification needed

“We need the ASME ‘N' stamp (American Society of Mechanical Engineers nuclear certification)” he said.

Mr Unnikrishnan conceded that it would take time for Thermax to create facilities as well as upgrade existing facilities to the standards required, for making nuclear components, manufacture and get them approved.

The company aims to align its core strength in heat and mass transfer that comes in the secondary unit of nuclear plants, the first being the reactor.

“Our strength is in high quality manufacturing units, besides heat and mass transfer and project management capabilities,” he said.

Thermax aims to partner global majors which bag the contracts in India.

It finds itself well-equipped and positioned to take up the localisation portion the overseas players would offer in the sub-continent.

Cost and revenues

Referring to plant cost and revenues available for the secondary portion, Mr Unnikrishnan said in the US, the cost for one mega watt was in the range of $3-4 million and American companies were trying to do it at $2.5 million in India. The reactor portion accounts for half the cost and the conventional portion the balance.

Ruling out the possibilities of Thermax getting into forging, casting and machining, Mr Unnikrishnan said the company preferred to stick to high-quality fabrication under the ASME stamp.

Global alliances

On areas that Thermax was looking for global alliances to shore up its capabilities for nuclear power business, he said for component manufacturing it was imperative to associate with global majors in the field as “one cannot learn, but only practise what is being followed”.

Hindu Business Line | Pune, April 18, 2010

Energy and environment solutions company Thermax has won a Rs. 580 crore order for a gas based combined cycle power plant from an Indian petrochemical major for its aromatic complex in a SEZ. The 72 MW project comprises two gas turbine generators, one extraction cum condensing turbine, two fired heat recovery steam generators and two oil/ gas fired boilers apart from other auxiliaries. The entire engineering, procurement and construction of the power plant including power evacuation, instrumentation, civil works, piping and miscellaneous balance of plant will be done by Thermax Ltd on a turnkey basis. Till date, Thermax has contracted over 60 turnkey power projects including a few independent power plants (IPPs), representing over 1,600 MW of Power. These plants are based on various fuels including, coal, biomass and waste heat from steel and cement industry. — Our Bureau

Financial Express | April 27, 2010

Pune-headquartered Thermax, an energy and environment solution provider, has set its sights on renewable energy. It has identified four segments as having domestic potential. “There is a renewed thrust on renewable energy and we believe the biomass, wind, solar and geothermal have potential for growth in India,” says managing director, MS Unnikrishnan.

Keen not to miss the opportunities presented by the growing energy market, Thermax will focus on rural power generation in the biomass and solar segments. Unnikrishnan won't give away any specifics just yet but points out that there is a need for 20,000 MW both on and off the grid. “So, even if a part of it fructifies, it will still be a large market,” he observes. Thermax is moving up the value chain with its in-house capability of up to 300 MW and the recently formed joint venture with Babcock & Wilcox (B&W) for super critical and 300+ MW boilers.

With cash in hand of Rs 800 crore and an order book of close to Rs 5,200 crore (end-December 2009), Thermax, experts believe, is poised for strong growth. Specifically, they point out, the company is adding to its expertise in the power equipment space. A likely pick-up in capital expenditure by industry should bring more orders for Thermax. The engineering firm recently bagged a Rs 580-crore order for a gas-based plant. That, say experts, highlights how Thermax is ramping up the EPC business in terms of size, scope and the client base.

The joint venture with B&W for manufacturing and supplying both sub- (above 300MW) and super-critical boilers will help Thermax compete with the likes of Bhel, L&T, Gammon India, BGR Energy as well as Korean and Chinese international players. “Considering that B&W has a strong track record of its technology, the JV is likely to have a decent market share,” observes brokerage IDFC SSKI.

Thermax has the majority 51% stake in the joint venture, with B&W holding the rest. The JV will set up a 3000MW- capacity plant, which is to be operational in 18-24 months. Observes IDFC SSKI, “While the JV for super-critical boilers is a step in the right direction, we believe the JV is unlikely to drive earnings over the next two years.”

The capital expenditure for the plant is estimated to be Rs 700 crore, of which the equity component is likely to be Rs 350 crore. Thermax will fund its equity of Rs 175 crore through internal accruals as it has cash of Rs 625 crore after accounting for Rs 175 crore to be paid for a US litigation settlement.

According to Kotak Institutional Equities Research, Thermax may receive about two- three orders for entry-level utility plants up to 300 MW over 2011-12. For the core energy business, excluding utility and large captive power plant orders, orders are expected to come in at a modest 10% compounded annual growth rate over 2011-2013.

However, analysts are somewhat apprehensive that Thermax's operating margins in the energy segment could contract as the company takes on large-sized boilers and EPC contracts. “Margins for large-sized contracts could be as much as 200 bps lower than small-sized orders,” says Kotak Institutional Equities Research. The energy segment contributes about 80% to the company's revenues, with the remaining 20% coming from the environment business. Holding the 80% ratio for the energy segment will be challenge, says Unnikrishnan.

That apart, maintaining the current margins, when raw material prices increase, will be another challenge for the company this year.