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The manufacturing arm of Vedanta group company Global Products and Services produces power transmission components including conductors, power cables and overhead cables.
In November, the company announced the spinoff of its streaming business into a separate entity. In an interview, Agarwal said the company is awaiting approval of the demerger from the National Company Law Tribunal (NCLT) and expects the process to be completed in Q2FY25.
“The business best suited for the public markets is our manufacturing business. There are multiple players listed in that space (some are in B2B, others in B2C) and some are capitalizing on India’s growth story. We are also on a wave of global growth. “50% of our business comes from exports. We have 40 clients in the US, Europe, Latin America, Southeast Asia and Australia. Therefore, it is very suitable. After the spin-off, we will evaluate all fundraising options,” he said. Added.
“We have no urgency, but we will certainly evaluate all options. If the markets are favorable and depending on investor interest, we will certainly consider listing the manufacturing business.”
The company is also considering expanding its existing manufacturing facilities in India, besides setting up a new facility, Agarwal said. “The total investment for expansion (both brownfield and greenfield) must be in the range of $Between Rs 350 and 400 million.”
The manufacturing business is projected to grow 20-30% in FY25, driven by around $2 billion dollars in central sector transmission projects in India.
The company is also in talks with private equity investors to raise funds for its streaming business, he said. “That is the business we operate in as a highway operator, where we build, own and operate transmission lines, providing transmission services to end users, generators and consumers. That business is growing very, very fast. And then we are thinking about closing a large transaction with a very large investor, which we hope to finalize soon.”
The company’s transmission division also operates in Brazil. It has a portfolio of 30 completed and ongoing projects, totaling around 14,602 circuit kilometers (ckm) of transmission lines in India and Brazil. It is focusing on further consolidating its presence in India’s streaming sector.
Agarwal, who is also chairman of another Vedanta group entity, Serentica Renewables, said the company is driving its ambitions in round-the-clock renewable energy solutions. “At Serentica, our goal is to provide 24-hour renewable energy solutions to large factories by selling renewable energy. These large-scale and energy-intensive factories currently rely on thermal energy consumption. “Our goal is to replace between 15 and 50% of its thermal energy with renewable energy.”
“Currently, one of the most exciting opportunities in the entire decarbonization space is how to replace the carbon consumption of these large factories, which are responsible for consuming 80% of greenhouse gases worldwide, with renewable energy “, he claimed.
“We will certainly deploy batteries in our fleet in different shapes and sizes. Additionally, we will explore alternative forms of storage, whether owned by us or a third party, and then contracted to us.”
On March 20, Mint reported that Serentica was planning to sell a minority stake to raise around $300 million to fund its ambitious growth plans.
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Posted: Mar 24, 2024, 08:11 pm IST