22-10-2014, 04:41 PM
PROJECT REPORT
ON
BHARAT HEAVY ELECTRONICS LIMITED
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Heavy Electrical Industry
A brief description:-
Heavy industry sector is one of the core sectors of Indian economy. Therefore, it’s fund requirements are inverse keeping in view the scale and size of the industrial units in the sector, the financial requirements are also huge. The heavy engineering sector is driving primarily by technology. This, coupled with the fact that the initial investment required for heavy engineering or capital goods manufacturing facilities is relatively high, creates relatively high entry barriers. Any business enterprises viability eventually boils down to cost – return trade off. Cost of funds is undoubtly, the most important determined of the viability. This becomes more crucial in heavy engineering sectors
The development of the Indian heavy electrical machinery industry is directly linked to the Performance of the Power sector in India. With India’s development, the need for more and Better Power supply has become essential for industries to grow. Thus with increasing focus on capacity expansion in the Power sector, the heavy electrical machinery manufacturing industry is expanding vigorously.
BACKGROUND:-
Heavy Electrical Industry covers power generation, transmission and distribution and utilization equipments. These include turbo generators, boilers, various types of turbines, transformers, switchgears and other allied items. Majority of the products manufactured by heavy electrical industry in the country, which includes items like transformers, switchgears etc. are used by all sectors of the Indian economy. Some major areas where these are used are the multi core projects for power generation including nuclear power stations, petrochemical complexes, chemical plants, integrated steel plants, non-ferrous metal units, etc.
HISTORY:-
India is the only other developing country besides China, which produces a full range of electric power generation and transmission equipment. In fact, the history and growth of (Bharat Heavy Electricals Ltd.), a public sector enterprise under in the country, symbolizes the overall growth pattern of heavy electrical industry in the country.BHEL has the unique distinction of being one of the very few companies in the world, manufacturing all major power generating equipment under one roof .The industry has been upgrading the existing technology and is now capable of taking up turnkey contracts also for export markets.
The industry has been deli censed. Foreign collaborations are allowed with 100 percent FDI.The country is planning to add 150,000 MW power generation capacities in the next 10 years. This will generate substantial demand for heavy electrical equipments. The heavy electrical industry is capable of manufacturing transmission and distribution equipment up to 400 KV AC and high voltage DC. The industry has taken up the work of up gradation and transmission to the next higher voltage system of 765 KV and have upgraded their manufacturing facilities to supply 765 KV class transformers, reactors, CTS, CVT, bushing and insulators, etc
Company background
1956 - Company was set up at Bhopal in the name of M/s Heavy electrical (India) Ltd. in collaboration with AEI, UK. Subsequently, three more plants were set up at Hyderabad, Hardwar and Trichy. The Bhopal Unit was controlled by the company, the other three were under the control of Bharat Heavy Electricals Ltd. - The Company`s object is to manufacture of heavy electrical equipments. 1972 - In July the Operations of all the four plants were integrated. 1974 - In January Heavy electrical (India) Ltd was merged with BHEL. - For the manufacture of a wide variety of products, the company has developed technological infrastructure, skills and quality to meet the stringent requirements of the power plants, transportation, petro chemicals, and oil etc. - BHEL has entered into collaboration which are technical in nature. Under these agreements, the collaborators have transferred, furnished the information, documentation, including know-how relating to design, engineering, manufacturing assembly etc. 1982 - BHEL also entered into power equipments, to reduce its dependence on the power sector.
Technology Up gradation and research and development
To remain competitive and meet customers’ expectations, BHEL lays great emphasis on the continuous up gradation of products and related technologies, and development of new products. The company has upgraded its products to contemporary levels through continuous in-house efforts as well as through acquisitions of new technologies from leading engineering organizations of the world.
The corporate R&D division at Hyderabad leads BHEL’s research efforts in a number of areas of importance to BHEL’s product range. Research and product development centres at each of the manufacturing divisions play a complementary role.
The investments in R & D by the electrical industry are amongst the largest in the corporate sector in India. Large electrical equipment used in steel plants, petrochemical complexes and other such heavy industries are also being manufactured in the country. The domestic heavy electrical equipment manufacturers are making use of the developments of the global market with respect to product designs and upgrading of manufacturing and testing facilities. The heavy electrical industry has established its reference in the global arena also. These encompass thermal, hydro and gas based power plants, substation projects, rehabilitation projects, besides a wide variety of products like transformers, photo voltaic equipments, insulators, switchgears, motors, etc
Bharat Heavy Electricals Limited (BHEL)
Company overview:-
Bharat Heavy Electricals (BHEL or the company) is an India-based engineering and manufacturing company that develops electrical and power equipment in energy related and infrastructure sector. It manufactures over 180 products under 30 major product groups and caters to sectors including power generation and transmission, transportation, and renewable energy, among others. The company operates in India and exports its products to several countries.
BHEL is headquartered in New Delhi, India and employs about 46,748 people. The company recorded revenues of INR418, 546.6 million ($9,178.7 million) during the financial year ended March 2011 (FY2011), an increase of 26.2% over FY2010. The operating profit of the company was INR72, 109 million ($1,581.4 million) during FY2011, an increase of 76.3% over FY2010.
The net profit was INR60,533.6 million ($1,327.5 million) in FY2011, an increase of 39.9% over FY2010.Note: The operating profit has been calculated after deducting the following items from net turnover as mentioned in the company's "Consolidated Profit and Loss Account" for FY2011: consumption of material, erection, and engineering expenses; other expenses of manufacture; employees' remuneration and benefits; administration, selling, and distribution provisions (net); and depreciation and amortization.
OPPORTUNITIES AND THREATS
• Government of India has embarked upon an ambitious programme of doubling the generation capacity to ensure “Power on demand by 2012”. This would necessitate huge mobilisation of resources to the tune of Rs.80,00,000 million including Transmission and Distribution (T&D) sector which has been identified as a high priority area. Due to inadequate investments in Transmission Sector so far, power evacuation from generating stations remains a major bottleneck. Accordingly, a perspective plan to build 30,000 MW inter-regional transmission network and formation of national grid are being drawn up. Distribution is another area which is being reformed to improve the financial health of the State Electricity Boards (SEBs) through various initiatives like privatisation/ Corporatisation. In order to bring about improvements in the functioning of the SEBs,Government has taken a number of initiatives including securitisation of outstanding dues of SEBs.This development will improve the credit rating of SEBs enabling raising of funds for investments.
• Government has been developing strategies to improve the hydro-thermal mix and substantially step up the contribution of this clean and stably priced source of energy through higher budgetary allocation and speedier clearance process. BHEL, being a major equipment supplier, is likely to reap benefits from this initiative.
• Government is also taking steps to promote captive power capacity which is estimated to be about 20,000 MW. A comprehensive Captive power generation policy for purchase and wheeling of surplus power is being evolved, which is likely to boost investment in this area. BHEL being a major player in this business segment stands to gain.
• Coal as a fuel will continue to dominate powergeneration in our country, more so for the reason of energy security. To reduce the cost of power, pit-head and coastal plants are planned to be set up to avoid high cost of transportation of coal and relieve the already stretched rail network. In addition to this, from the point of view of greater thermal efficiency and environmental considerations, Gas/ LNG based power plants will continue to be the preferred choice of power plant builders in the medium term.
• During the year gone by, industries, to which BHELsupplies the capital goods, experienced a slow rate of growth as well as stagnation in investment activity in the country. Also, the prospects of investment activity picking up during the current year seem difficult. Index of Industrial Production (IIP) is projected to grow by a higher rate of 3.5% in 2002-03 compared to 2.7% in 2001-02, a positive signal for impending industrial recovery. Among the sectors, Cement and Transportation are poised for healthy growth in 2002-03.
• For optimal development of electrical energy in its totality, an integrated approach, including capacity addition through Non-conventional sources has been adopted by the Government. Accordingly, a target of 10700 MW through non-conventional sources has been fixed for the period up to 2012.
• Distributed Generation (DG) and Combined Heat and Power (CHP) are emerging growth opportunities in the near future. In addition to conventional DG technologies, Biomass, Photo-voltaic, Wind turbines, Micro turbines and Fuel Cells are progressing at rapid pace and promise to change the economic equation of this large and important market.
• In order to accelerate rural electrification, it has been proposed to treat rural electrification as a basic minimum service in the Prime Minister’s Gramodaya Yojna.
• Rural electrification plan for electrification of 62000 villages by 2007 and 18000 remote villages (through renewable) by 2012 is being proposed.