ABB bags Rs 2,350-million Powergrid contract

Mumbai: ABB, the leading power and automation technology group, has been awarded a large contract by Powergrid Corporation of India (PGIL) to design, build and install a new power transmission system at Vishakapatnam. The total order is valued at approximately Rs 2,350 million, of which ABB India's work scope is around Rs 1,300 million. "We pioneered the HVDC technology, and understand customer requirements for projects of this nature," says ABB executive vice-president and utilities division head Richard Siudek. "This interconnection will contribute to Powergrid's phased development of a national grid, while providing the near-term benefit of improved regional power reliability."

By changing focus from big orders to medium-sized ones and an increasing thrust on industrial automation have seen ABB India registering a growth in its order book in the current year. The company, however, says that more than 50 per cent of its revenues still come from its power utility business.

"Till last year, we were looking at large and major orders to increase our business. But slow industrial growth has forced us to consider medium-sized ones also, which are worth less than Rs 30 crore," says a senior company official. The company has seen a 37-per cent rise in orders in the first half of the current financial year as against that in the previous year. It has also reported an 18-per cent rise in turnover.

The shift in focus, currently on in India, is part of a move by the parent, ABB Worldwide to increase its business. The group is now trying to sell its finance company to General Electric, in a bid to get out of non-core areas.

The order backlog for ABB India stood at Rs 1,832 crore at the end of the first half as against Rs 775 crore at the beginning of the year. An order backlog indicates the amount and value of work that the company has on its books. Most of ABB Indias orders came from T&D (power) and industrial segments.

"The latter category has seen a growth in capacity utilisation, mainly in cement, steel and paper companies. These projects involve increasing efficiency and reducing costs," the ABB official adds.