TARIL, a key player in the power and infrastructure sector, has made a strategic acquisition of Posco Poggenamp Electrical Steel Private Limited, one of India's leading manufacturers of cold-rolled grain-oriented (CRGO) electrical steel. This acquisition, completed through a cash consideration, brings a significant step forward in TARIL's mission to achieve 100% backward integration for the company's supply chain needs. The move enhances TARIL’s manufacturing capabilities in CRGO lamination and built-up cores, essential components for transformers and reactors used in power distribution.

Posco Poggenamp Electrical Steel, with an installed capacity of 24,000 MT per annum, is a major supplier of high-quality CRGO laminations in India, serving voltage classes up to 1200 kV and capacity ratings up to 500 MVA. The company, founded in December 2010, has earned a reputation for its stringent manufacturing standards that ensure reliability, precision, and high performance, qualities indispensable in critical power distribution applications. By acquiring this facility, TARIL strengthens its position in the transformer industry while optimizing its supply chain and operational efficiency.

One of the core reasons behind this acquisition is to address the high reliance on CRGO electrical steel in the transformer manufacturing process, a component that constitutes approximately 33-35% of the total raw material cost. CRGO steel’s quality is a pivotal factor in transformer efficiency and longevity, and TARIL’s acquisition ensures better quality control and uninterrupted supply of this crucial material. The company’s new CRGO processing capability will allow for tighter specifications, enhancing product reliability and supply chain stability.

In addition to backward integration, this acquisition aligns TARIL with India’s commitment to sustainable and clean energy. With the ongoing growth in energy and infrastructure demands, TARIL’s expanded capacity enables it to meet the needs of both domestic and international markets. Moreover, TARIL’s new, dedicated CRGO processing plant will contribute significantly to India’s energy sector by ensuring the availability of high-quality electrical steel for transformers and reactors, which are integral to the nation's energy grid.

Furthermore, TARIL has secured a long-term supply contract with steel mills to ensure a steady flow of mother coils, reinforcing its supply chain for years to come. This secure source of raw materials is expected to stabilize production costs, enhance reliability, and boost EBITDA margins both on a standalone and consolidated basis.

As a fully integrated CRGO processor, TARIL is poised to meet the evolving demands of the global energy market. This acquisition not only expands TARIL’s market share but also provides a sustainable platform for further growth and operational efficiency. In doing so, TARIL reinforces its commitment to India’s clean energy goals and enhances its position in the power infrastructure sector.

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Start your stock market journey by opening a Free Demat Account with Choice Broking FinX today. This acquisition reaffirms TARIL’s commitment to innovation and efficiency in the transformer and reactor manufacturing supply chain.