Hitachi Plans to Build Indian Power-Equipment Plants by 2014

Hitachi Ltd., Japan’s third-biggest company by sales, plans to complete building two power-equipment plants in south India by 2014, Yasunori Taga, chief executive officer of the company’s Asian operations, said in an interview.

“It will take another two-three years,” Taga said in New Delhi today. “By 2014, it will start production.”

Hitachi joins Mitsubishi Heavy Industries Ltd. in setting up ventures in India to make boilers and turbines. Asia’s third- largest energy consumer needs to add power generation capacity to reduce blackouts and sustain economic growth of 8 percent annually.

The company expects revenue of 100 billion yen ($1.2 billion) by 2017 from the two plants, which are adjacent to each other and will manufacture equipment with 3,000 megawatts of capacity every year, Taga said. The plants will be expanded to make equipment for export fromAsia’s second-biggest major economy, he said.

“We would like to be able to use India as an export center as well,” Taga said.

Hitachi said in August it will form two ventures with BGR Energy Systems Ltd. and invest $450 million in turbine production and 100 million euros ($136 million) to make boilers. The facilities are located in south India’s Tamil Nadu state.

Mitsubishi’s two ventures with India’s Larsen & Toubro Ltd. at Hazira in Gujarat state started production in July.

State-owned Bharat Heavy Electricals Ltd., India’s biggest manufacturer of power generation equipment, is increasing annual capacity to produce equipment capable of generating 20,000 megawatts by 2012 from 15,000 megawatts currently.