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TPG Capital Eyeing Stake In Luminous Power says VCCircle

Luminous which was founded in 1988 and started off providing Invertor and UPS solutions has since grown to become a power and energy storage company in India delivering high quality Inverters, UPS, Batteries and Renewable Energy Products. The company now has technologies in power electronics, batteries and storage systems, packaged power and renewable energy systems. The company claims to follows its proprietary UGC (Universal Grid Compatibility) process to ensure consistent & very high standard of reliability of its products.

Luminous recently has designed, manufactured and installed off-grid and grid connected wind-solar hybrid power plants. Panchabuta has earlier talked about Luminous’s  pioneering effort  in small wind turbine business in India and its installation of wind-solar hybrid.

Panchabuta has talked about the huge opportunity for companies such as Luminious in the cell phone tower space and in discussion with some of the senior technical experts from the tower companies is given to understand that the telecom industry is looking for complete hybrid solutions that can match the expectations of the telecom tower infrastructure players and their availability and service levels.

Luminious is well poised to deliver such services given the energy costs for cell phone companies  is about 8% of the revenue generated for most operators and power and fuel contributes to about 25% of the total network cost.

Given this scenario, it is no surprise that, according to reports, TPG Capital is eyeing stake in Luminious Power. According to VCCircle,TPG Capital, the global private investment firm, is in advanced level of talks with Luminous Power Technologies (P) Ltd–which makes inverters, appliances and batteries–for buying a significant stake in the battery maker.

Although the discussions (with TPG) are at a fairly advanced stage, sources indicate that the company was also examining the possibility of floating an IPO if the private equity option falls through.     

Luminous India, a part of the SAR Group, recently touched a turnover of Rs 1,000 crore. An email sent to Puneet Bhatia, heading TPG’s investments in India, did not elicit any response says VCCircle.  “TPG is not in talks with us for majority stake,” Rakesh Malhotra, CEO, SAR Group told VCCircle. Malhotra added that they have held preliminary talks with the company and there is no clarity yet of a deal. 

According to that report, Luminious has raised a  funding of $20.3 million from CLSA Capital Partners in 2007.  It has also been fairly active on the M&A front. In 2009, it acquired a majority stake in Tritronics (India) Pvt. Ltd., a Delhi based on-line UPS company for an undisclosed sum.  It also acquired a majority stake of 87.5% in UD Energy Systems the same year.

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