Thermax scouts for a partner to charge up its green energy unit

Mumbai | New Delhi: Thermax is looking to bring in an external investor in its renewable energy subsidiary First Energy and is open to offer over 51% stake in the business, people aware of the development said.

Working with advisors

The Pune-headquartered engineering and capital goods company is working with advisors on a potential stake sale, they said.

The enterprise value of the business could be around ₹3,000 crore, depending on the stake being sold and the transaction structure, the people said.


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First Energy (FEPL), which has an installed renewable energy capacity of around 800 MW, has a paid-up equity capital of about ₹646 crore. The business, however, has run into various challenges that have affected its performance, an executive aware of the development said.

Execution challenges

"FEPL could have done better but for the right-of-way issues and working with various state governments," the executive said.

Thermax is looking to bring in a partner to help manage the business and address these operational challenges, the person added.

Thermax declined to comment.

In its FY26 annual report, Thermax acknowledged that First Energy had not performed as planned. "Alongside the external environment, we continued to navigate operational complexities and execution challenges. The company is implementing corrective measures to strengthen execution and improve delivery timelines," it said.

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First Energy provides renewable power solutions to commercial and industrial (C&I) customers across solar, wind, wind-solar hybrid and battery storage. It offers captive and group captive projects as well as open-access renewable power solutions across states under capex and opex models, besides operations and maintenance services.

Scaling up business

The company also provides customised off-grid solutions to industrial customers seeking to transition to renewable energy.

Thermax acquired a 33% stake in First Energy in 2015, with an arrangement to increase its holding to 100% over the following four years. First Energy was originally launched in 2005 as BP Energy India, a wholly-owned subsidiary of BP. The potential stake sale comes as renewable energy companies are increasingly looking to bring in strategic and financial investors to fund capacity expansion and strengthen execution capabilities.

For Thermax, the transaction could provide a partner for scaling First Energy's renewable portfolio and addressing operational challenges, the executive cited above said.