Steamhouse plans capex of ₹2,500 crore, initiates talks with PE investors

October 29, 2021 07:55 pm | Updated 07:55 pm IST - MUMBAI

Steamhouse India Ltd., which supplies steam to industrial units in Gujarat for their manufacturing activities, has drawn up a 5-year expansion plan which would involve a capital investment of ₹2,500 crore, the firm’s managing director Vishal S. Budhia said.

He said the company, currently having a monopoly in the business, will have eight operational units in Gujarat and Maharashtra by FY23 and the plan is to expand to a total 40 units across states by 2027 as India requires about 200 such units to meet the demand from industries.

“Ours is a capital intensive industry and accessing capital is a challenge. By FY23 we will have a total cumulative investment of ₹300 crore since 2015 and besides this, our 5-year business expansion plan involves a capex of ₹2,500 crore,” Mr. Budhia said.

“We are taking to private equity investors and many have shown deep interest in out business model. We are also planning for an IPO next year to raise resources to meet our expansion plan,” he added.

The company runs common large boilers with the capacity of 30 tons and 60 tons per hour and supplies steam through overhead pipeline to the manufacturing units in the textile, pharmaceutical and chemicals sectors to name a few.

Next year, it will open its first unit in Maharashtra and then expand to South and North once funds are tied up, Mr. Budhia said.

He said the company is also helping in reducing pollution in industrial clusters through its efficient large boilers besides freeing the industries from capex.

“Our FBC (fluidised bed combustion) boilers have 83% efficiency as compared to small boilers that industries use in general with 65%, efficiency which means we help in reducing carbon footprint and emissions,” Mr. Budhia said.

He said the company which is already co-generating electricity from the boilers, is soon going to produce and sell instrument air and nitrogen through a piped network to industries in the same vicinity.

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