BHEL bullish on matching Chinese prices despite dumping

25 March 2008

Public sector power equipment maker Bharat Heavy Electricals (BHEL) has accused Chinese power equipment makers of grabbing equipment supply contract for mega power projects by resorting to dumping.

K Ravi Kumar, chairman and managing director, BHEL, said there was a price difference of up to 20 per cent and the Chinese valuation was also not as per international competition, as the Chinese currency was under-valued.

He, however, said there was no need to take up the issue very aggressively, saying "We need not go and fight with the Chinese. We don't want 100 per cent market share." He said a 60-per cent market share with enough profits is what BHEL was aiming at.

Kumar also said BHEL's upcoming joint venture with NTPC Ltd, which is likely to be incorporated by first week of April, would also help it in maintaining its market share.

"We are going for another company to take the 40 per cent market. To prevent Chinese competition, Russian competition or Korean companies, we are going for another company with NTPC," Kumar said.

At the same time, he said, BHEL was not complacent at all even with an order book of over Rs82,000 crore. "We have to improve upon this and we are working in that direction," he said, adding that BHEL's technical tie-up with Alstom was in a position to take on the Chinese companies.

In terms of performance, BHEL's equipment was superior and referred to independent studies to establish that the plant load factor of its projects was 90 per cent, while that of its Chinese rivals was only 60 per cent.