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M&M to acquire 26% stake in Gelos; MSPL forays into hybrid RE segment

15-Apr-24 15:38 Hrs IST

Gelos is a wholly owned subsidiary of Mahindra Susten (MSPL). MSPL, in turn, is a subsidiary of Mahindra Holdings (MHL), which is ultimately a wholly owned subsidiary of Mahindra & Mahindra.

Gelos Solren (Gelos) is an Indian company formed for the purpose of production and sale of power and generating electricity, distributed energy including rooftop solar, installation for commercial, industrial, institutional and residential segment.

The company will acquire 26% stake in Gelos for total consideration of Rs 40.08 crore. The said acquisition will be completed by 31st August 2025.

The said investment will help the company in reducing its energy cost, carbon footprint and working towards its commitment of ?Planet Positive? businesses and adopting 100% renewable energy by 2030 across various businesses.

Further, the Group has announced that it will develop a around 150 MW hybrid RE (solar + wind) project. The total project cost is around Rs 1,200 crore.

The project will be developed by Mahindra Susten, part of Mahindra Group and a leader in renewable Independent Power Producer (IPP) business, with marquee global investor Ontario Teachers? Pension Plan board as a strategic partner. The installation will include around 101 MW wind capacity and around 52 MW solar capacity and is expected to generate 460 million kWh of energy leading to expected abatement of 420,000 tonnes of CO2 emissions.

The project also marks Mahindra Susten?s foray into the ?hybrid RE? segment and will be one of the largest co-located solar + wind hybrid projects in Maharashtra to deliver clean energy to commercial and industrial (C&I) customers. The project will be commissioned within the next two years and will integrate more than 80% locally manufactured components.

The Auto & Farm businesses of M&M has contracted capacity of approximately 41.20MW of wind and 25.90 MW of solar within this project which will annually generate about 197 million kWh of energy and is expected to abate around 184,000 tonnes of CO2 emissions. The project is expected to increase the Renewable Energy (RE) share of M&M from 34% in FY23 to around 60% in FY26.

Anish Shah, CEO & MD, Mahindra Group, said, Energy transition is a key global and national priority to address climate change. This project is a tangible example of our commitment to sustainability, as a consumer of green power, and building ?Planet Positive? businesses, as the developer of the project. It also demonstrates a clear economically accretive business case and Group synergy.

Deepak Thakur, CEO & MD, Mahindra Susten, added, We are indeed pleased to announce our foray into the hybrid RE space and deliver clean, green power at competitive rates to large C&I consumers. This project will showcase the immense potential of hybrid RE solutions in helping companies transition towards green operations.

Veejay Nakra, President, Automotive Division, M&M, said, ?As the auto business invests to increase capacity and shifts towards a greener portfolio with the impending launch of multiple EVs, we want to ensure our operational emissions also come down. This project is a clear win for both economic and environmental outcomes, and a step further in integrating sustainability closely with business strategy.?

M&M Group enjoys a leadership position in farm equipment, utility vehicles, information technology and financial services in India. It is the world's largest tractor company by volume. It has a strong presence in renewable energy, agriculture, logistics, hospitality and real estate.

The auto major's standalone net profit surged 60.59% to Rs 2,453.98 crore in Q3 FY24 as against Rs 1,528.06 crore recorded in Q3 FY23. Revenue from operations increased 16.7% year on year (YoY) to Rs 25,288.51 crore in the quarter ended 31 December 2023.

Shares of Mahindra & Mahindra were lower 0.76% to Rs 2,054.45 on the BSE.