BHEL is a market favorite, but investors in the power sector are not too impressed by its abilities. India is building huge power projects but BHEL does not have the technology to build large machines called super critical turbines.But now BHEL has something to cheer about, the Ministry of Heavy Industries (MoHI) is backing it. According to the sources, MoHI is backing BHEL for super critical projects and draft cabinet note by MoHI says that BHEL should get first 10 projects on nomination basis.
The Power Ministry has a different view, it thinks that India needs many more equipment makers, so not only BHEL but other big companies should be encouraged to build for power and it cited the example of China which has three major players.
With the government backing BHEL might see a lot of orders coming. India has to add about 80,000 Mw in five years and that could mean orders worth Rs 70,000 crore for BHEL. While present order book of BHEL is about Rs 50,000 crore it might cross Rs 1 lakh crore by 2012 backed by supercritical projects.
Though the Ministry of Heavy Industries has supported BHEL for supercritical projects, there are two real issues, where will the technology come from? and what will be the pricing? A committee of secretaries will look into pricing and will also take a call on whether BHEL will be given the first 10 supercritical power projects by preference.
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