"Whole technology circle gets completed"
According to industry analysts, the next purchase of Mukesh Ambani-led Reliance New Energy Solar Ltd (RNESL) would be a battery technology company as Asia's wealthiest man aims to complete his armoury across the whole gamut of solar energy sector and shatter Chinese hegemony internationally.
"If I look at their chessboard, I guess the next in line would go for a battery technology acquisition," said Ratnadip Bhattacharjee, CEO and Director of ArrayTech Technologies Pvt Ltd, a solar design and engineering services business. Then his whole technical cycle, which includes solar modules, panels, cells, wafers, and batteries, is finished, according to Bhattacharjee.
According to an industry consultant, storage is “one area which has always been a pain for the solar industry”. Once he has control of the battery technology, he can generate electricity whenever the Sun is available, store it, and deliver it according to demand, ensuring that there is no mismatch between production and consumption.New energy business
New energy business:
With a flurry of recent purchases, primarily on the technology side, Ambani's plan and vision for his venture into the new energy market have begun to unravel.
"Reliance is putting the chess pieces in the appropriate spot", "Ambani is purchasing technologies and organisations with good technology in this arena", Bhattacharjee says.
The sector is being electrified by Reliance's strategy of viewing the solar business as a technology rather than a short-term money-making enterprise or a small-time business. "Ambani is looking at the business on a global basis, not in terms of customs duty management, lobbying opportunities, and so on, but as a business in and of itself."
He is going up against China on a global scale, and you can't battle someone by raising customs duties. "He is not interested in competing with China for the Indian portion of the market," Bhattacharjee says.
Aside from Sterling & Wilson Solar Ltd, an EPC firm, the acquisition of Norwegian solar cell, panel, and polysilicon maker REC Solar Holdings AS, Germany's monocrystalline green solar wafers developer NexWafe GmbH, and the cooperation agreement with Denmark's Stiesdal A/S for technology development and manufacturing of HydroGen Electrolyzers in India demonstrate Ambani's new energy play's direction.
"You can only thrive in this company if you have technology and size." Reliance's strength has always been scale, and scale is not an issue for them to handle. As a result, he is pursuing technology.
Aims to be Global Player:
Using a subpar panel raises the cost of establishing solar plants, and the only way for the local industry to survive is for the government to levy tariffs here and there. Reliance sees it as a worldwide business, not just a domestic one. Ambani aspires to be the primary supplier to the whole solar industry. Reliance requires technology and size to achieve this goal; otherwise, it will be unable to compete on a global scale.
"The difficulty with the solar sector now is that the majority of individuals who know the technology are in China." It is really tough to enter China and control that technology, so he has chosen Europeans for technology
From this vantage point, Ambani's $771 million acquisition of REC Solar Holdings AS is viewed as his first assault on Chinese dominance. REC was owned by China National Bluestar (Group) Co Ltd, a Beijing-based speciality chemicals and materials corporation.
REC is one of the remaining module companies outside of China, with good technology that is a little pricy. However, if you have the technology, the price is manageable.
Solar Module Technology:
Outside of China, there is now very little technology accessible for solar module or cell manufacture, as most enterprises have gone bankrupt. All of the world's main solar module producers have been surpassed by Chinese competitors.
If you are looking for a firm with large and also some speedy production capabilities as well as manufacturing technology, Reliance is a really good selection. NexWafe is a wafer manufacturer with good technology, assisting Reliance in expanding its reach in the solar technology arena supported by wafers and cells.
Both are regarded attractive bargains because Reliance would otherwise have to go shopping in China, which could make it harder for Ambani to pick up a Chinese company and obtain the technology. "Buying a company is easy, but getting hold of technology in this field is really difficult", remarked an industry executive.
The solar sector is distinguished by constantly evolving technologies.
None of the Indian solar producers have any influence over the technology part of it. They are practically nothing more than followers. Because it is the technology game in which one can outperform the others.
As a result, I view Reliance's acquisition to be very well thought out. They are a new arrival into this area, yet they understand the fundamentals of the business far better than the
others.
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