ENGIE is open to inorganic opportunities and bullish on Indian power market, says GlobalData
Following the news on 13 November 2018 that global energy and services group ENGIE has acquired a 90% controlling stake in Simpa Energy India to fund geographic expansion and accelerate growth,
Ankit Mathur, Power Industry Analyst at GlobalData, a leading data and analytics company, offers his view on this development and its implications:
“The Indian power industry is undergoing rapid transformation and is well on course to achieve its ambitious renewable energy target of 175 gigawatt (GW) by 2022. Simpa Energy India is a leading solar solution provider in rural areas of Uttar Pradesh, Bihar and Odisha. Through this acquisition, ENGIE, which is one of the largest foreign investors in India’s solar space, is reinforcing its commitment towards decentralized renewable energy solutions to support India’s rapid transition to clean energy.
“ENGIE India plans to provide solar home solutions with pay-as-you-go pricing model to households and small businesses in rural India. The company currently has around 800 megawatt (MW) of utility scale solar projects (around 330 MW under construction) and 280 MW of utility scale wind (all committed in final development or construction).
“In September 2018, ENGIE and French infrastructure and investment firm STOA announced a 50:50 joint-venture (JV) to build wind power projects in India. The JV has set a goal of establishing over 2 GW of wind power capacity over the next five years. The JV will be developing both onshore and offshore wind projects under the scope.
“In November 2018, ENGIE Laborelec, the utilities division of ENGIE, announced partnership with Tata Consultancy Services to develop cyber security products and services for power utilities and critical energy infrastructure.
“ENGIE has been actively increasing its investments and offerings in India’s renewable energy and power sector. This acquisition is in line with the company’s strategy to remain close to customers in the distributed energy market. The company will leverage Simpa’s innovative business model in this huge untapped market with significant growth potential. The company is bullish on the Indian power market and is open to inorganic opportunities if they make a sound and promising business sense.”
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