NEW DELHI Feb 29 A joint venture between
India's BGR Energy Systems and Hitachi Power Europe
GmbH has emerged the lowest bidder for 160 billion rupees ($3.27
billion) power equipment order from NTPC, India's
state-run power producer.
State-run BHEL, the biggest power equipment in
producer India, is the second-lowest bidder, while the joint
venture between India's Larsen & Toubro and Japan's
Mitsubishi Heavy Industries emerged the third lowest, a
senior official at NTPC said.
NTPC opened the price bids on Wednesday for supply of the
supercritical boilers for nine units of 660 MW power each. Price
bids for two units of 660 MW each of Damodar Valley Corp,
another state-run company, were also part of the process.
Shares of BGR Energy rose 9.61 percent to 368.95
rupees on the news, while Larsen & Toubro fell 3.02 percent to
1,308.05 rupees. BHEL was down 0.37 percent to 307.35 rupees
after initially rising.
BGR Energy said in a statement it would be awarded contract
for seven boilers worth about 65 billion rupees.
The award of the orders comes with one-year delay after
Ansaldo Caldaie, a bidder, challenged in the Delhi High Court
its disqualification in the technical round of bidding.
NTPC resumed the process to award the contract after India's
top court overturned the high court order which had favoured
Ansaldo last month.
The power generator will award the orders to the two lowest
bidders after it evaluates the bids submitted by the three
bidders over the next few days, said the NTPC official.
"It brings clarity to NTPC's expansion plans," said V.
Srinivasan, a sector analyst with Angel Broking.
This award of orders will help NTPC add about 6,000 MW
capacity. The company plans to raise its capacity to 66,000 MW
by 2017 from 36,000 MW now.
"There are not many orders right now in the market. It's a
relief for BGR," said an analyst, rated five-star by Thomson
Reuters StarMine. "It will improve their cash flows but it won't
improve their profitability as they will import 70-80 percent
Indian power producers have slowed their expansion as they
struggle to source fuel, acquire land and get environmental
clearances. There were not many major orders for gear makers in
the past one year because of this.
On the other hand, many equipment makers such as Bharat
Forge, JSW Energy and Thermax have
partnered with international players such as Alstom SA
, Toshiba Corp and The Babcock & Wilcox Co
, to bid for contracts better.
Shares in NTPC, valued at about $30 billion, ended 0.56
percent up at 181.05 rupees.