Government-Owned Solar Cell and Module Manufacturer CEL Up for Sale

The government decides to disinvest 100% shareholding in CEL


The government of India has invited an expression of interest (EoI) for the proposed disinvestment of 100% shareholding in Central Electronics Limited (CEL).

The last date for the submission of interest is March 16, 2020.

The CEL is a government enterprise under the administrative control of the Department of Scientific and Industrial Research (DSIR), Ministry of Science & Technology having solar cell and module manufacturing capacity of 10 MW and 38 MW respectively. CEL also has other products it supplies to the railways and defense sectors.

As per the EoI document, the selected bidder will be required to lock in its shares for a period of three years during which it cannot undertake the sale of its stake in CEL. The process for the transaction has been divided into two stages – Stage I and Stage II.

Stage I

Through this invitation of expression of interest (EoI), the transaction advisor is providing the interested bidders with the instructions for submitting their EoIs which would be used for prequalifying them in accordance with the eligibility criteria and disqualification conditions.

Stage II

Based on an evaluation of the EoIs submitted, shortlisted bidders will be provided with the request for proposal (RfP), a confidential information memorandum (CIM), and access to the data room, which will provide further details of the CEL and the transaction in terms of the RfP.

As far as the eligibility criteria are concerned, any private limited company or public limited company registered under the Companies Act,  which is eligible to invest in India, can take part in the bidding process. Central public sector undertakings and central government-owned cooperative societies (where government ownership is 51% or more) are not eligible to participate.

An interested bidder should have a net worth of ₹500 million (~$7.003 million) as of March 31, 2019, and the bidder should have been in practice for at least three financial years as of March 31, 2019.

The consortium of interested bidders may also take part in the transaction. The consortium should not have more than one lead member and the lead member should have a minimum equity contribution of 51%. The minimum equity contribution by other interested bidders to qualify as a member of the consortium should be at least 20%.

The lead member of the consortium should have a minimum net worth of ₹260 million (~$3.64 million) and each member of the consortium should have a minimum net worth of ₹100 million (~$1.4 million) as on March 31, 2019.

For the financial year 2018-19, the company had tangible assets worth ₹34.75 million (~$486,735) and intangible assets of ₹1.98 million (~$27,775). The total assets for the financial year stood at ₹275.516 billion (~$3.85 billion). The total revenue of the company for the financial year 2018-19 was ₹2.392 billion ($33.57 million) and the total profit before interest, depreciation, and tax was ₹126.274 million (~$1.76 million). Its profit for the year 2018-19 stood at ₹16.8 million (~$235,314).

As of March 31, 2019, CEL’s paid-up capital is ₹692.2 million ($9.71 million) and net worth is ₹759.9 million ($10.66 million).

Recently, CEL invited bids to supply 100,000 monocrystalline solar cells. According to the tender, the solar cells must be five bus bar cells with a minimum efficiency of 18.8%. They must be about 200 microns in thickness and measure 156.75×156.75 or 157×157 mm in size.

Earlier, CEL had invited bids for 44 MW of solar generating systems ranging from 250 kW to 10 MW at various substations located in the state of Maharashtra.

Image credit: Schneider Electric