Now on an organic path to growth -- Suzlon strategy

India's Suzlon Energy, which bought Belgian gearbox maker Hansen Transmissions International for $520 million in March, has ruled out further acquisitions for the immediate future. "For the next three to four years we are looking at an organic growth for the company while we will consolidate the Hansen acquisition," said the company's Tulsi Tanti at a meeting of the company's key personnel, held in Mumbai, India. Suzlon has already announced plans to expand Hansen's capacity from 3200 MW to 5800 MW by 2008 and is considering setting up a turbine manufacturing plant in Europe and an Indian blade testing facility in Baroda, Gujarat, for the Asian market. "Currently, we are generating 60% of our business from India, 30% from the US and the rest from other countries including China," said Tanti. By 2010 he wants 80% of Suzlon's business to come from outside India, predicting that China, the US and Europe will also each account for around 20%, with the remaining 20% coming from the rest of the world.

Globalisation

For Tanti, who has based his global headquarters in Denmark, globalisation is paying off. In the last six months, the company has received orders for 1,443 MW worth $1.4 billion, marking its entry into Portugal and Brazil. Of its 8700 employees, 1900 are employed outside India. For Brazil, delivery of the 225 MW of Suzlon 2.1 MW turbines -- to be installed across six projects -- starts in the first quarter of the 2007-08 financial year.

"We want to grow faster than the world average," said Tanti. The UK, Taiwan, Greece and Philippines markets are those he has his eyes on for the immediate future. "Pakistan, too, is growing."

The key aim, however, is growth in China. The Chinese political will to promote alternative energy will see the country's wind market grow larger than India's in the next two to three years, Tanti said. "We see a strong growth in China as a result of a good grid and a feed-in policy." India might have a dedicated ministry for new and renewable energy sources, added Tanti, but there is no commitment on the Kyoto Protocol and no serious focus on setting a legalised national standard for the minimum content of green power in electricity supplies.

Developer in China

Suzlon will approach the Chinese market with a "development, supply, project construction and services model," he said, working with Chinese partners in three provinces. Suzlon has experience in developing its own wind projects from India. The company is doubling capacity at its China plant to 1200 MW by early 2009 and hopes to establish gearbox manufacturing facilities there in the long term. "This will help us service the China market more efficiently," he said

In India, Suzlon has over 30 wind farms in eight States. "We are doing a wind resource study in West Bengal, Orissa, Chhattisgarh and Bihar. If we find resources there, we will expand into those states as well," said the company's Girish Tanti.