Thermax and US based Babcock & Wilcox have agreed to form a joint venture to make super-critical steam boilers for the domestic market, the two companies said on Wednesday.
Thermax will hold 51 per cent and Babcock & Wilcox Power Generation Group Inc will own the rest in the venture, which will also manufacture sub-critical boilers of more than 300 megawatt capacity, the firms said in a joint statement.
The two companies plan to invest a total 7 billion rupees, split equally between debt and equity.
Thermax will pump in a little more than 1.75 billion rupees into the venture, its managing director M S Unnikrishnan told a media briefing.
The super-critical boilers will be produced at a proposed new unit that will have an initial annual capacity of 3,000 megawatt equivalent, they added.
Thermax already has a technology partnership with Babcock & Wilcox to make boilers of up to 300 megawatt.
Thermax shares, which rose as much as 4 per cent in the session ahead of the news, were trading 2.4 per cent higher at 671 rupees in a firm Mumbai market at 12:47 pm
Super-critical boilers are high-end heat equipment that has attracted the attention of the country's power sector planners for its ability to produce more heat per kilogram of coal burnt, saving costs and causing less harm to the environment.
The government is planning to add capacity of 100,000 megawatt between 2012-17, a majority of which will be super-critical technology, fuelling demand for such high-end equipment.
In August 2009, Thermax formed a joint venture with diversified US manufacturer SPX Corp to provide air pollution control systems for power plants above 300 megawatts and energy efficiency equipment.
Thermax also has technology tie-ups with Japan's Kawasaki Thermal Engineering, Germany's Balcke Durr, Canada's Eco-Tech and US' Georgia Pacific.