Orb Energy is looking to use the capital to grow its in-house finance facility of rooftop solar panels for Indian SMEs and to further expand its Kenya operations.
Solar energy systems maker Orb Energy has raised over Rs 95 crore ($15 million) in a part-equity and part-debt round from the Dutch development bank FMO, self-sustaining US government agency Overseas Private Investment Corporation (OPIC), African finance institution Pamiga and Germany’s development finance institution DEG.
With this, the total capital raised by the company stands at $26 million.
With over $10 million of this round raised as long-term debt from OPIC, Orb is looking to use the capital to grow its in-house finance facility of rooftop solar panels for Indian SMEs and to further expand its Kenya operations.
Orb’s in-house platform provides finance to SMEs looking to reduce electricity costs through ownership of a rooftop solar system. To make the adoption of solar panels easier, Orb offers finance packages without collateral.
Based out of Bengaluru, Orb provides solar energy systems such as solar panels and water heaters, and has sold over 150,000 systems in India since inception in 2006.
A vertically integrated company, Orb manufactures its own solar photovoltaic panels and solar water heating systems through two manufacturing plants in southern India and has a cumulative installation of over 30 MW of rooftop solar systems over the past decade.
In India, rooftop solar systems offer industrial customers a 3-4 year payback without any subsidy – an unheard of return on investment on an unsubsidized solar power system. But many cash-constrained SMEs in India cannot afford the up-front costs of solar without credit. Orb is looking to cement its position in this market as a leading credit facility provider, a move that it expects will drive strong commercial sales growth.
“We will generate revenues of over Rs 100 crore in FY18 and are projecting a 40-50% increase in topline growth over the next three years. For FY19, we are targeting revenues of Rs 150-160 crore,” Damian Miller, CEO of Orb Energy, told ET. With a production capacity of 2-3 MW per month currently, Miller is targetting to increase production to reach the full capacity of 60 MW over the next year.
“Orb has demonstrated through its unique in-house finance facility and vertically integrated approach, that profitable growth is possible in this fast-moving, highly competitive segment of India’s solar market,” said Jurgen Rigterink, CEO of FMO.
With this capital infusion, Orb is aiming for profitability in the rooftop solar sector in India within the next couple of years. The company will also use a small part of the capital raised to expand its residential and commercial solar business in Kenya, where it has sold over 10,000 systems since 2014.
Source: tech.economictimes.indiatimes
