Motilal Oswal Private Equity Advisors Private Limited (Motilal PE) is investing Rs 40 crore in Power Mech Projects Ltd (Power Mech) for an undisclosed stake.
The 10-year-old Power Mech is engaged in erection, testing and commissioning of boilers, turbines and generators for thermal and gas-based power plants besides overhauling and maintaining them. It has an unexecuted order book of Rs 1,500 crore.
Promoted by first generation entrepreneur, S Kishore Babu, Power Mech has, in the past, worked with key players in the power sector including BHEL, NTPC, Tata Power, Lanco, Adani among others.
According to S Kishore Babu, Chairman & Managing Director of Power Mech, "the company would be investing around Rs 40 crore over the next 1-2 years towards building its own equipment bank for increased mechanisation to fast track the mobilisation of new sites." Religare Capital Markets advised Power Mech on the deal.
India accounts for about 4% of the world’s total electricity consumption, and domestic consumption of electricity is expected to grow 8-10% per year, propelled by the country’s accelerating economic growth.
Motilal PE currently manages and advises two funds - the $125-million India Business Excellence Fund (IBEF) that focuses on SME investments and the recently launched $175-million India Realty Excellence Fund. The PE firm has already made eight investments out of the SME fund since its inception in January 2007 in companies across sectors such as bulk packaging, power transformers, ITES, dairy and reverse logistics.