Transformers & Rectifiers (India) Ltd [TARIL] is planning complete backward integration with a view to shortening its production cycle.
Addressing an earnings conference recently, Jitendra Mamtora, Chairman, TARIL, said that the full backward integration is targeted to be achieved by the first quarter of FY26, which is by June 2026.
An important step towards the proposed backward integration would be to put up a new tank fabrication plant for which land has already been acquired. The first phase of this fabrication plant is targeted to commission by March 2025 or so, but not later than June 2025, the top official said.
Discussing the tank fabrication plant in some detail, Mamtora explained that TARIL was in an advanced stage of taking over a CRGO processing house based in Ahmedabad. This, in the Chairman’s view, was one of the best processing houses in the country. It may be mentioned that CRGO or cold-rolled grain oriented steel is a critical component used in transformer tanks, and more importantly, India relies entirely on imported CRGO.
To secure CRGO supplies, TARIL has entered into agreements with global suppliers to source the company’s requirements, estimated at 1,000 – 1,200 tonnes per month. In fact, Mamtora said that TARIL would be in a position to supply processed CRGO to other domestic transformer manufacturers as well.
The TARIL Chairman also explained that the company was in advanced stage of collaborating with a leading manufacturer for producing transformer bushings as part of its backward integration plans. Mamtora said that TARIL would be manufacturing RIP (resin impregnated paper) bushings, which are currently not manufactured in India. Transformer bushings, commonly used in India, are of the OIP (oil impregnated paper) type.
Speaking of the company’s capacity expansion plans, Jitendra Mamtora said that the company’s overall manufacturing capacity would be expanded by 15,000 MVA by January 2025. The entire capacity expansion will be taking place at the company’s Changodhar unit in Gujarat, it is learnt. TARIL currently has a total capacity of around 40,000 MVA, spread over three manufacturing locations – Odhav, Changodar and Moraiya – all in Gujarat.
Higher share of exports
TARIL is aiming at exports accounting for over 25 per cent of the company’s revenue. To this effect, the company is aiming at supply specialized transformers to European, African and American markets. Mamtora noted that strategic tie-ups are shaping up with global giants in the field of transformers used in renewable energy, oil & gas, etc, as well as special-application rectifier transformers.
Discussing global trends, Jitendra Mamtora said that most leading transformer manufacturers, especially in Europe, USA and Turkey, have their capacities booked for the next 2-3 years. In view of this, TARIL has the opportunity to export specialized transformers. Mamtora added that there is little or no competition on the pricing front. Companies that can guarantee timely deliveries have a big opportunity in the international markets, he felt.
Speaking of important orders, the TARIL Chairman said that a “landmark” supply of a 175 MVA EAF (electric arc furnace) transformer was recently made to ArcelorMittal in Mexico. Two more such transformers will soon be supplied to the same customer. It may be mentioned that TARIL is currently the only Indian company equipped to manufacture EAF transformers, which are used in the steel-making process.
Order book in H1FY25
According to an investor presentation filed on stock exchanges, TARIL said that it received new orders worth Rs.1,729 crore in H1 of FY25,which was inclusive of Rs.1,031 crore booked in Q2 (July to September) of FY25.
During H1FY25, TARIL received an important order – that of a 420kV three-phase reactor with synthetic organic ester oil — placed by Power Grid Corporation of India Ltd.
As of September 30, 2024, the company’s outstanding order book position was around Rs.3,500 crore. Around 65 per cent of this order book related to power transformers, followed by reactors (29 per cent) and special-duty transformers (6 per cent).
Viewed from customer profile, a large part (46 per cent) of this outstanding order book was from industrial consumers. Central utilities accounted for 43 per cent of this order book, followed by state utilities representing the remaining 11 per cent.
Featured photograph shows TARIL’s Changodhar transformer manufacturing facility in Gujarat
