The largest platform for smart metres in India will be created by Genus Power Infrastructures Ltd., a maker of listed smart metres, and Singapore's sovereign wealth fund GIC. Additionally, GIC will use warrants to make a roughly $75 million, or Rs600 crore, investment in Genus Power.
With a market share of over 27%, Genus Power, a 1995 startup, is one of the top companies in India's power metering systems market. With a combined installed capacity of more than 10 million metres, the company operates manufacturing facilities in Jaipur, Haridwar, and Guwahati. The platform will compete for smart metre concessions in India, a market with an estimated $30 billion in annual sales.
GIC will own 74% of the platform and the governing rights, with Genus owning the remaining 26%. With Genus, the platform will have an exclusive supply agreement for smart metres. The platform's headquarters will be in Singapore.
"A sovereign wealth fund like GIC is establishing a platform where it would be a controlling shareholder right from the outset for the first time in India. According to a source, sovereign and pension funds typically invest in minorities on most platforms. "This is GIC's second major bet in the Indian energy space after renewables," he continued.
The agreement between GIC and Genus takes place at a time when the smart metre industry is benefiting greatly from government initiatives and supportive policies. "By 2026, the Indian government wants to install 250 million smart metres. The government is pushing to speed up the programme because the rate of deployment of the same has been slow, and more state utilities are anticipated to offer smart metre concessions in the upcoming quarters.
The government has derided the smart metre business model with the "direct debit" system, wherein the smart metre operator is paid first when a consumer pays, even though the financial stability of state utilities in India has remained a key worry.
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