Two to tango: NTPC-BHEL JV finalized

GOI has finalised the JV between NTPC and BHEL. The JV, which will be operational from October 2008, will focus on the following areas;

1. Manufacture of balance of plant equipment-mainly coal handling plants, ash handling plants and water demineralising plants
2. EPC contracts by participating in competitive biddings.
3. O&M work particularly for state utilities.
4. Boiler and turbine manufacturing will NOT be the focus.

Sources indicate that the JV and would soon bring in a private partner.

As capacity shortages and quality in these three areas specifically have emerged as critical constraints for the growth of power sector in India, we view this development as a big positive for both, more so for BHEL as it would ensure a steady market for them.