To meet the growing demand from small and medium businesses (SMEs) for its rooftop solar systems, Bengaluru-headquartered Orb Energy plans to double its manufacturing capacity of photovoltaic panels from 60 MW to 120 MW at an investment of ₹20 crore. The capacity expansion is expected to create 100 new jobs.
The company, which raised $15 million in equity and debt earlier this year from the Netherlands Development Finance Company (FMO) and Overseas Private Investment Corporation respectively, is in talks to raise $10-15million of equity investment in the January-March quarter of 2019 and an additional $40 million of debt over the next three years, a top executive of the company told BusinessLine .
Since its inception in 2006, Orb Energy has raised a total of $23 million in equity and debt.
Growth in demand
“We have sold over 160,000 solar systems in Karnataka, Andhra Pradesh, Tamil Nadu and Maharashtra with cumulative installations of over 40 MW of rooftop solar systems. While most of that in the past was residential installations, in the last three years, we have seen the SME segment growing. This is largely because we provide collateral-free loans to SMEs that are payable over three to four years,” said Damian Miller, co-founder and CEO, Orb Energy Pvt Ltd.
He expects the company’s revenue to grow by 40 per cent to touch ₹150 crore this fiscal, up from ₹107 crore last fiscal, driven primarily by SME demand for rooftop solar power. Orb Energy has extended ₹30 crore in loans in the last two years to over 50 SMEs and has served over 500 SMEs to date.
Pointing out that demand began to rise three years ago, when solar power became cheaper than power from the grid, he said, “It does not make economic sense for businesses to buy power from a Discom when costs can be halved with solar power.” Janata Fish Meal and Oil Products in Udupi district of Karnataka first started off with 100 Kw rooftop solar installation from Orb Energy, added a further 500 Kw and recently increased it to 1 MW, generating 50 per cent of its power requirements from solar energy, he said.
Some of the company’s clients are Sipani Fibres, Meerut Institute of Engineering and Technology, MG Brothers Felicity Mall, AVN Saigal Plastic Industries, NBKR Institute of Science and Technology.
Asked about the total addressable opportunity for SME rooftop solar sytems, Miller said the estimated market size for SME rooftop solar over the next five years to be 12 GW, which in rupee terms is ₹48,000 crore.