Reliance Industries Ltd

As part of a strategy to expand its clean energy portfolio through partnerships, Reliance Industries, through its unit Reliance New Energy Solar Ltd (RNESL), has invested in German “green solar wafers” technology company NexWafe GmbH (NexWafe) and signed a pact with Danish company Stiesdal A/S for hydrogen electrolyzer.

RIL said late Tuesday (12th Oct 2021) that it had put $25 million into NexWafe’s Series C financing round. RIL becomes a strategic lead investor in the company, which develops and manufactures cost-effective monocrystalline silicon wafers (commonly known as green solar wafers).

“Our investment in NexWafe signals an important step towards accelerating India’s green energy transition and positioning India as a global leader in photovoltaic manufacturing,” RIL chairman Mukesh Ambani said in a statement.

“We believe NexWafe’s innovative ultra-thin wafer will give solar manufacturers a significant advantage over existing photovoltaic technologies, helping consumers in India and globally realize the benefits of solar energy more quickly and more efficiently,”
Ambani added.

The transaction is expected to close before the end of the month.

NexWafe’s solar photovoltaic products will benefit from RIL’s assistance in the product, technology, and commercial development. The two businesses have also signed an ‘India Strategic Partnership Agreement,’ which outlines combined technology development and commercialization of high-efficiency monocrystalline “green solar wafers” on a large scale.

RIL will gain secure access to NexWafe’s unique technology as part of its plans to establish large-scale wafer production facilities in India based on NexWafe’s processes and technology.

Separately, RIL informed the stock exchanges late Tuesday that RNESL had signed a memorandum of understanding with Stiesdal A/S, a Danish company, to partner and cooperate on the completion, development, and subsequent manufacturing in India of hydrogen electrolyzers developed by Stiesdal. Steisdal will grant RNESL a technical license for this purpose, according to the MoU.

Both initiatives are in line with Ambani’s ambitious plans to invest Rs 75,000 crore in a new sustainable energy sector over the next three years, to help the conglomerate meet its goal of becoming carbon-neutral by 2035.

The plan is divided into three sections: a Rs 60,000 crore investment in four Giga factories that will manufacture and fully integrate all of the company’s critical components; a Rs 15,000 crore investment in the value chain, partnerships, and future technologies, including upstream and downstream industries; and repurposing the company’s engineering, project management, and construction capabilities toward clean energy.

RIL announced two renewable energy purchases on Sunday through its subsidiary Reliance New Energy Solar. The business announced that it will pay $771 million to China National Bluestar (Group) Co for 100% ownership in solar panel maker REC Solar Holdings AS (REC Group) (around Rs 5,802 crore). RIL also announced the purchase of a 40% share in Sterling & Wilson Power, a company that specializes in solar power engineering, procurement, and construction.

RIL made its first significant step into the renewable energy sector in August when it invested $50 million in Ambri Inc., a US-based energy storage startup.

“With RIL’s solar manufacturing strategy in place, we now incorporate the anticipated CAPEX for solar capacity of up to $5 billion in our model,”
HSBC Global Research wrote on Tuesday, ahead of the latest announcement.

“We also alter our projections to account for higher refining margins and faster telecom subscriber growth.” As a result, our profit expectations have increased by 5-13%, and our target price has increased by 15%.”

The firm kept its ‘hold’ rating on RIL shares but raised the price objective to Rs 2,350 from Rs 2,050 before.

RIL shares closed at Rs 2,668.5 apiece on the BSE on Tuesday, up 0.7%.

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