The founding members of Navitas Green Solutions - Vineet Mittal (31), Sunay Shah (34), Ankit Singhania (30 years), Aditya Singhania (27 years) and Saurabh Aggarwal (27) - all have a family business background in fields such as textiles, power sector, construction and IT. But, they decided to branch out of their family business and do something on their own.
After completing their BTech and MBA courses, they started doing research about the benefits of generating electricity from wind energy. As the founders realised the prospects of renewable energy, they zeroed in on solar energy.
Hence, with a mission to accelerate the adoption of solar technology, to conserve the environment and provide an eco-friendly and sustainable power supply, the group of five friends established Navitas Green Solutions Pvt Ltd in 2013 in Jaipur, Rajasthan.
Navitas provides clean and cheap form of electricity in the form of Solar PV modules and is also working to fight climate change. The company says it is known for the quality and reliability of its solar modules, which has enabled the company to be recognised as one of the leading manufacturers of Indian solar modules.
The founders initially invested Rs 25 crore and have so far invested a total of Rs 50 crore in the company and recorded an annual turnover of Rs 88 crore for the financial year 2017-18.
Apart from manufacturing solar PV modules, the company says it executes turnkey EPC services of solar projects, builds, owns and operates solar projects. It caters to commercial and industrial consumers as well as residential and institutional customers who are adopting solar energy as a source of electricity.
Navitas, which currently has more than 150 employees working on its rolls, says identifying the correct (trained) manpower for manufacturing operations and developing the brand in the market were the biggest problems encountered by the business in its initial days.
Currently, the team is working to address the issue of lack of additional working capital to scale up its operations.
The founders say the initial fund raising was done by taking loans from banks. It was also a big challenge to raise funds as the public sector banks hesitate to fund greenfield projects, especially in the solar manufacturing sector.
Vineet says, “We had to give a high amount of collateral to get the bank finances and also had to put in a considerable amount of equity for the same. Slowly and gradually, as the business grew, bank limits started increasing. But still financing remains a big concern for scaling up the business.”
He says, while demonetisation did not affect the business much, due to its immediate ban, there was a slow movement in the retail segment.
Introduction of the GST also significantly affected the business. Vineet says, “Our working capital management has been affected adversely due to the inverted duty structure as our raw materials is at a higher rate (18 percent) and the end product is at a lower rate (5 percent). Due to this, our working capital gets stuck and refund takes a lot of time, sometimes more than a year, and because of this, raw material availability gets affected.”
“We are still a new brand compared to our competitors. Hence the established players sometimes get an upper edge over us,” he adds.
Vineet wants the government to address the inverted duty feature. He says,
“We’d also like to have a long-term policy and support to domestic manufacturing to mitigate the risks perceived by banks to fund the scaling up of the business.”
In 2016, the company diversified into turnkey EPC business of solar projects and has done more than 5 MW of rooftop solar installations. In recent times, the company has further diversified into RESCO model of solar business where solar project is developed and electricity produced is sold to credit worthy customers.
Vineet says, the company won the first prize in RESCO model project bid invited by IPGCL for installation on government buildings this year.
According to Vineet, the company stands out from its competitors as it has been able to develop high quality solar modules for the distribution sector, which was usually available only to utility scale buyers. The company has also managed to integrate the product fully, which gives improved control over performance and in turn a higher customer satisfaction. He says,
“We have also implemented technology to provide ease to the customers with features such as online self-registration of warranty. Our modules have enabled our customers to adopt clean generation technology, which produces electricity at a cheaper rate than they could get from the grid or diesel generator.”
Apart from this, the company has also been organising training programmes and regular lectures to students and engineers in the field of solar energy to create awareness. It also conducts tree plantation activities and donates solar street lights to social organisations. The donation also helps in creating awareness about the potential of solar energy to counter the global climate change.
In order to gain more customers, the company says it maintains close contact with the industry through its regional sales offices and through participation in various seminars and conferences.
Vineet says he is fortunate enough to have many helping hands in the business where each of the members have a defined role.
Vineet is the promoter-director of the company and has been associated with strategic financial planning, developing relationships, promoting the brand, building the team and developing national as well as international sales. Ankit is the director of purchase and procurement and plays a vital role in strategic sourcing and maintaining interpersonal relationship with the vendors. He also oversees the supply chain management on a worldwide scale. Aditya is the EPC director and is actively involved in developing new products.
Among the other Co-founders, Sunay Shah is involved in the working of group companies and also plays a key role in project acquisition, development and execution activities. Saurabh is the head of taxation and logistics. He has been instrumental in leading the material and logistics management for the company and also handles all the taxation and legal matters of it.
“The market size of this sector is estimated to be approximately Rs 8,000 crore and is growing. India remains the main market for the business because the growth scale which exists here is unparalleled,” says Vineet.
The company is gradually expanding its presence to African and the Middle East Asian markets as it sees growth prospects for solar energy.
Navitas wants to become the biggest solar energy company in India and aims to develop a fully sustainable smart city completely powered by solar energy. Vineet says,
“Our plan is to grow our export footprint and global presence in the coming years, simultaneously with consolidation in the domestic market as it is our biggest market for years to come.”
He believes creating a space in this sector is easy only when entrepreneurs do a proper homework and research. He says, “Identifying a niche area in order to develop an expertise is important. As the sector is growing, a niche expertise is going to help the business in a long run.”
(This story is published in partnership with the MSME Ministry to showcase success stories of SMEs)