Toshiba-JSW Joint Venture to Begin Production of Supercritical Power Boilers

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Researched by Industrial Info Resources (Sugar Land, Texas)--The 75:25 joint venture between Toshiba Corporation (TYO:6502) (Tokyo, Japan) and the JSW Group (Mumbai, Maharashtra) will begin civil work within the next six months at its 100-acre manufacturing site for supercritical power boilers at Ennore near Chennai in Tamil Nadu. The joint venture, which will manufacture and market steam turbines and generators in India, was created in May 2008. The project involves an investment of about $422 million and will be commissioned in phases over three years. The investment amount will be raised through equity and debt, with the debt amount sourced entirely from Japan.

The joint venture will be involved in designing, manufacturing, marketing and maintaining medium and large steam turbines and generators with capacities ranging from 500 megawatts (MW) to 1,000 MW. The plant will initially produce power equipment for 3,000 MW of power, and the capacity will slowly be increased to 5,000 MW. The equipment will be manufactured to meet the demands of thermal power plants in India. According to Mr Sajjan Jindal, vice chairman and managing director of JSW Steel Limited (BSE:500228) (Mumbai), there are plans to scale up the plant so that in the future it can manufacture equipment for nuclear power plants as well.

JSW Steel holds a 5% stake in the venture while JSW Energy Limited (Bangalore) holds a 20% stake. The managing director of JSW Energy, S. S. Rao, said that the products of the joint venture would help the JSW Group gain a stronger foothold in the Indian energy sector. He also said that the joint venture was created with an aim to meet India's growing demand for electricity. Toshiba's executive vice president, Atsuhiko Izumi, believes that by joining with JSW, Toshiba will successfully build a presence in the quickly growing Indian market. Keihin Operations is Toshiba's power equipment production facility in Yokohama, Japan. The facility will support the joint venture's manufacturing process during the initial stages.

According to the Eleventh (2007--2012) and Twelfth (2012--2017) Five-Year National Electricity Plans published by the government of India, the power-generation-equipment market in India is expected to see growth in power demand reach 15,000 MW to 16,000 MW per year in the next decade. Coal-fired thermal-power is expected to account for 60% of this growth.

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