Well positioned to execute large export orders: Hitachi Energy

With exports constituting one-fourth of its total orders, a target Hitachi Energy achieved a year in advance in FY24, the company is well positioned to secure large orders like the ₹790 crore Marinus Link (Australia) project secured in Q1 FY25, N Venu, the company’s MD & CEO for India and South Asia said. Speaking to businessline, he emphasised that the global focus on energy transition assures continued opportunity. Excerpts from the interview:

Q. Hitachi Energy’s export orders have been rising. What are your expectations going ahead?

When we started operations five years ago, exports were around 15 per cent of the total order book, and our ambition was to grow it to 25 per cent by FY25. We achieved this milestone a year in advance through concerted investments in strategic product lines and expansion, reflecting our successful strategy of ‘Make in India for India and the world’. In addition to a consistent 25 per cent contribution to order book from exports, we are well positioned to cater to such one-off large export orders like the Marinus Link.

Our approach has enabled us to secure a steady stream of orders for our feeder factories from various international markets, highlighting the strength and reliability of our operations. And the global focus on energy transition assures us of continued opportunity, assuming all else stays the same.

Q. How is the company gearing up to meet its order deadlines, especially with already existing order backlogs?

We have been powering India for 75 years, a testament to our focus on the nation, strategic investments in developing people and expanding manufacturing capabilities. A keen understanding and foresight of the ever-evolving energy landscape in the sub-continent has ensured that we always stay ahead of the curve.

We power mission-critical projects that impact lives and economies, and meeting delivery timelines is our priority. Our first and primary aim is to serve the domestic market. Besides expansion, we constantly explore new models and partnerships to meet our existing order backlog and future demand. Our continuous improvement processes, especially in operational efficiency areas, help sustainably improve reliability.

Q Do you have any investment plans to meet the growing demand?

We are committed to maintaining leadership in our core portfolio, transformers, switchgear, grid integration technologies such as HVDC, power quality and grid automation. High growth segments, such as renewables, data centres and electrification of mobility, have driven the need for greater power quality solutions and increased grid automation.

In recent years, we have strategically invested in high-growth segments, which we believe will cement our market positioning over the long term. Since 2022, we have launched a mix of five green and brownfield factories under the listed entity.

Under the wholly owned subsidiary of the global parent, we have inaugurated the largest of its kind global technology and innovation centre. On average, we have maintained an annual capital expenditure (capex) of ₹100 crore, bringing our extensive expertise and foresight to evaluate and meet the evolving needs of the energy sector.

Q. In Q1 FY25, transmission projects have taken the lead in your order book. What does this signify?

Energy transition projects span multiple segments, and their full potential is realised when integrated into a flexible, digital, and secure grid. This quarter, our order book reflects a significant uptick in transmission projects from various utilities, mainly driven by the development of green energy corridors. This momentum in Q1 FY25 underscores the urgency for rapid energy transition and electrification.

Government has prioritised rapid inter/intra-state transmission capacity development through national programmes like the Green Energy Corridor, supported by significant investments. These initiatives, coupled with a growing appetite for clean power in India, will open more opportunities in the future.

Q. What are your thoughts on the decline in orders from railways and data centres in this quarter?

While there is a temporary decline in orders from railways and data centres, we consider both segments high-growth areas in the medium term. The rapid growth of data centres, along with the electrification of railways and the expansion of metro networks across the country, will drive these segments in the short term. The growth of data centres in India will continue to create significant opportunities.

Q. As renewable energy sources continue to grow, what strategies can be employed to address power quality concerns?

The intermittent nature of renewable sources poses challenges to their growth, but advancements in renewable energy technologies, such as improved efficiency, energy storage solutions, and grid integration capabilities, are driving faster adoption.

To address intermittency challenges, it is crucial to prioritise developing and deploying smart, mature, and advanced technologies that retain market relevance over time. Achieving a carbon-neutral future requires integrating large-scale renewable energy to overcome complexity and capacity issues. Today, 61 GW of clean power in India flows through Hitachi Energy’s technology, underscoring our commitment to accelerating the energy transition.