Murugappa Group’s CG Power to finish Rs 6.62 bn capacity expansion in 18 months

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Murugappa Group’s CG Power to finish Rs 6.62 bn capacity expansion in 18 months

Murugappa Group’s CG Power to finish Rs 6.62 bn capacity expansion in 18 months

Industry News
Jul 04,24

CG Power also kicked off the expansion of the production capacity of the large industrial machines (LIM) unit of the company situated at Mandideep, Bhopal, at an investment of Rs 350 million.

Murugappa Group’s CG Power to finish Rs 6.62 bn capacity expansion in 18 months

CG Power and Industrial Solutions, an engineering firm of the Murugappa Group, has said it is on to a Rs 6.62 billion capacity expansion. The company’s order intake for FY24 was Rs 105.12 billion and as of March 2024, the unexecuted order book stood at Rs 64.11 billion.

“The company has in total, so far, approved Rs 6.62 billion expansion projects, which will be funded through internal accruals. These projects are under implementation and expected to be completed in the next 18 months,” N Srinivasan, Managing Director, said in the company’s latest annual report.

It is investing significantly in ramping up production capacities for motors, transformers, and switchgears, while it has forayed into semiconductor manufacturing and kicked off work for its Outsourced Assembly and Testing (OSAT) facility in Gujarat.

In 2023-24, the Rs 80.46 billion company initiated the expansion of its manufacturing capacity for instrument transformers and condenser bushings, medium voltage switchgear, and the GIS unit of its Switchgears Division situated at Nashik with a capital outlay of Rs 1.55 billion. It operates switchgear factories at Nashik and Aurangabad in Maharashtra.

The proposed expansion will increase the capacity of instrument transformers and condenser bushings up to 2,494 units per annum, from 384 units, medium voltage switchgears up to 5,000 units per annum, from 1,800 units per annum and GIS unit up to 780 units per annum, from the existing capacity of 168 units per annum.

CG Power also kicked off the expansion of the production capacity of the large industrial machines (LIM) unit of the company situated at Mandideep, Bhopal, at an investment of Rs 350 million. This will increase the capacity of Large Industrial Machines up to 1,728 units per annum, from the existing capacity of 1,002 units per annum.

In FY23, the Board had approved the expansion of the manufacturing capacity of power transformers and distribution transformers units situated at Malanpur and Bhopal at an investment of Rs 1.26 billion. The said expansion was for increasing the capacity from 17,000 MVA to 25,000 MVA for Power transformers and from 6,900 MVA to 9,900 MVA for distribution transformers.

Further to the above, approval has been provided during the year for an additional capacity expansion of power transformers (T3 unit) at an additional investment of Rs 30 million. This will increase the capacity for power transformers from 25,000 MVA to 35,000 MVA.

The annual report also said the company would hold 92.34% of the equity of the joint venture – CG Semi Pvt Ltd — that is establishing the OSAT unit in Gujarat at an investment of Rs 76 billion over five years. Its JV partners for this project are Renesas Electronics Corporation and Stars Microelectronics (Thailand) Public Co. Ltd.

(Source: Business Line)