Boiler Turbine Generator Equipment Market Dynamics and Outlook for Thermal Power in India- 2017

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Russell Russell
5 years ago
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1 Boiler Turbine Generator Equipment Market Dynamics and Outlook for Thermal Power in India Determining the Business Case for the Domestic & International OEMs, Tracking Degree of Competitiveness and the Way Out for Sustenance May 2017

2 Why enincon s report upon Boiler Turbine Generator Equipment Market Dynamics and Outlook for Thermal Power in India 2017? MAJOR ORDER BOOK FLOW FROM NTPC & SEBs, DRYING UP OF ORDER BOOK OF PRIVATE PLAYERS, PMP POLICY AND FAST PACED GROWTH OF RENEWABLE POWER WHAT FUTURE HOLDS FOR OEMS OF BTG EQUIPMENT MARKET IN INDIA CURRENT ANNOUNCEMENT FROM CEA LIKELY TO BENEFIT DOMESTIC OEMs IN TERMS OF REVENUE, SLUGGISH GROWTH OBSERVED FOR HEAVY MANUFACTURING INDUSTRY AND PRO- RENEWABLE ENVIRONMENT IN INDIA PRESENCE TOUGH TIMES AHEAD FOR OEMs : WHERE DOES THE OPPORTUNITY LIE? India s current installed capacity of 315 GW has still a fair share of thermal power plants based on coal which accounts for sufficing the base load of the country. Although, India is cognitive of the global trend of gradually wishing away with polluting source of coal based electricity generation, but completely stripping of these capacities shall not be possible for one of the fastest growing economies of the world. Given, the estimate even if we consider India to grow by a normative 7% as an economy, the need of growth in infrastructural development shall also be of the same order. Hence, despite country s Paris commitment to reduce carbon influx, India has to be dependent on coal till 2030 for meeting of its consistent base load. As country, shifts its portfolio from thermal to renewable in terms of capacity generation, the transcend also observed in terms of investment in the thermal and renewable space respectively. With India, completely witnessing drying up of orders from private project developers, the thermal power generation looks to be a dicey proposition for OEMs in the country. With fresh capacities only coming from either NTPC or SEBs in terms of new order, the current BTG equipment market look highly hinged in the favor of domestic OEMs, the fate of other bulk investments by big global OEMs looms large in dark. In this regard, it was quint essential to spot the silver lining in the current dynamics of thermal power generation for the OEMs to sustain and develop their respective business model. The DCR proposition and strict PMP obligation to be followed for NTPC s and SEB s PPs, road appears tough for those OEMs which donot manufacturing capacity installed in the country.

3 Capacity in GW Capacity in GW Capacity in GW Exhibit 01: Order Booked Capacity of BTG Equipments (Above 660 MW) in India for 12 th FYP* BTG Order Booked (For Above 660 MW) Capacity for 12 th FYP* as per Region & Developer Category (In Percentage) BTG Capacity ( For Above 660 MW) for 12 th FYP* (Commissioned + Upcoming) in GW 15 15% 11% 9% 24% 19% 11% State Players Central Players Private Players 7.5 DM: Domestic SDI : Shared Domestic- International IN: International C: Chinese NC: Non-Chinese 42% 44% 34% 0 DM SDI IN C NC 11% 30% Upcoming BTG (For Above 660 MW) Capacity for 12 th FYP* ( in GW) BTG Capacity (For Above 660 MW) for 13 th FYP (Order Booked in 12 th FYP*) in GW 50% 6 15 NR W R SR ER Please Note : The outer crust of the above doughnut signifies capacities of Central Players for all the regions, the inner crust signifies capacities of state players for all regions and the core signifies the capacities of private players for all regions 0 DM SDI IN C NC * Status as on DM SDI IN C NC Source : CEA, enincon research

4 BUSINESS CASE FOR BTG EQUIPMENT MANUFACTURERS IN INDIA 1. Coal to be the prime source of capacity generation supporting the base load power requirements of the country 2. Government working in line to make coal a cleaner fuel by replacing the old power plants with new ones, hence high efficiency on the generation front 3. In order to encourage the domestic manufacturing, government mandates state-run generators to insist on phased domestic manufacturing plan from supercritical equipment suppliers 4. The (CEA) advisory on indigenous manufacturing of supercritical equipment could lift profitability of domestic boiler turbine generator manufacturers 5. The government is working on a plan to shut down GW of old highly polluting thermal power plants and set up new coal based super-efficient power projects REPORT INSIGHTS 1. Detailed study of supercritical and subcritical power generation equipments market size in India 2. Business case evaluation for setting manufacturing units in India 3. Competition landscaping of existing OEMs into the BTG market in India 4. Factorial analysis of BTG market industry outlook in India for both domestic and international OEMs 5. Evaluating manufacturing outlook of boilers and turbine-generator sets in India 6. Focus on supercritical units and the planned capacity additions 7. Consumer category wise market size for BTG equipments in India 8. Opportunity in terms of modernizing of ageing units 9. Analyzing market drivers enabling opportunity in BTG equipment manufacturing in India

5 KEY HIGHLIGHTS 1. Understanding supercritical thermal power generation scenario in India 2. A holistic track of existing OEMs in the Indian power generation equipment manufacturing space and the market entry 3. Make in India and business case for domestic OEMs 4. Unleashing driving factors and restraints for BTG market in India 5. Tracking the financing facilities for BTG projects in India 6. Future outlook of in house BTG manufacturing facilities in India and the business case for domestic OEMs 7. Joint undertaking policy and other regulatory obligations impacting domestic manufacturing of BTG equipments 8. Evaluating region wise, consumer wise and supplier wise market size for BTG OEMs in India PRESS EXCERPTS Coal as a fuel for power generation is as important as renewable sources as it is essential to maintain the country s base load, power, coal, renewable energy and mines minister Piyush Goyal today said. ET energy The power ministry has just extended an existing advisory that mandates state-run generators to insist on phased domestic manufacturing plan from supercritical equipment suppliers. ET Energy

6 KEY QUERIES ADDRESSED What would be the potential market size for domestic OEMs by 2022 in Indian BTG space? Competitive benchmarking and landscaping of the players into the manufacturing of BTG equipments in India What would be the vendor base for sub-critical and super-critical BTG equipments in India? What would be competition degree of BTG OEMs in India vis-à-vis price factor? What would be the competitive edge of BTG OEMs in India vis-à-vis after sales service? What would be the competitive degree of BTG OEMs in India vis-à-vis extended scope capacity? What would be the impact of DCR and PMP policies on domestic manufacturing of BTG equipments? What opportunites shall hold for international and private domestic OEMs, given the policy change scenario? MUST BUY FOR Independent Power Producers Central Power Producers State Generation Companies Boiler Manufacturing OEMs Turbine Manufacturing OEMs Generators Manufacturing OEMs Balance of Plant Equipment Manufacturers Power Generation Equipment Vendors Other Value Chain Players Research Bodies Industry Associations Technical Consulting Group Financial Institutes/ Banks

7 Having said that arguably, by 2020 enincon believes that thermal power is destined to roll back into generation mix of the country and in all possibilities fresh UMPPs which have hit a road block may witness announcements sooner than later. Hence, preparedness for OEMs shall be of pinnacle importance which will be discovered through an in-depth research in this dossier. Queries like what OEMs should do given the changing paradigm, from where the opportunites will come for domestic and international OEMs, what shall be the impact of DCR and PMP policy and whether OEMs should witness a spurt in JV formulations or withdrawal from the country and many more apart from the mentioned will find answers in this collective and holistic market research. WHAT YOU CAN LEARN? A SNAPSHOT Market Structure of power generation equipment manufacturing in India Key Drivers and restraints for BTG equipment market in India Evaluating past trends and future outlook of BTG equipment manufacturing in India Track of region wise market share of BTG OEMs by volume (MW) Track of region wise market share of BTG OEMs by value (INR) Track of region wise market share of BTG OEMs by production capacity Track of region wise market share of BTG OEMs by manufacturing base Track of region wise market share of BTG OEMs by vendor base Competitive landscaping of exiting OEMs

Decommissioning Thermal Power Plants in India Evaluating New Industry Segment & Estimating USD 5 Billion Opportunity

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