Hitachi grids will hit 2025 target after green revolution

The power grid business Hitachi bought is involved in projects like connecting the world’s largest offshore wind farm in the North Sea to Britain. (Shutterstock)
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Updated 26 September 2020

Hitachi grids will hit 2025 target after green revolution

  • Demand for wind and solar power growing because of pandemic, says CEO

ZURICH: The power grids business Hitachi bought from ABB for $11 billion is likely to hit the upper end of its 2025 targets despite the effects of a coronavirus downturn over the next two years, CEO Claudio Facchin has said.

Hitachi ABB Power Grids, whose products connect power stations to homes and factories, expects a recovery as countries launch stimulus packages and the electricity industry switches to greener technologies.
The company which competes with Siemens, General Electric and Hyundai, is due to give an update on its financial targets in October.
“We see the pandemic as having a temporary effect and we’re optimistic about the future,” Facchin told Reuters.
“COVID-19 has a negative impact on us in 2020 and 2021, but by 2023 and 2024 we should not see any more effect. We expect an actual positive swing when the recovery and stimulus packages kick in,” he said.
Although global electricity demand is set to fall 6 percent this year, demand for wind and solar is rising 5 percent, the International Energy Agency estimates.
“The pandemic has accelerated the conversion from fossil fuels to renewable sources of energy like wind and solar,” said Facchin, 55, who also led the business when ABB was its owner.

FASTFACT

The global power grid market is worth $100 billion.

“We are helping customers master the additional complexity of variable renewable energy sources and combining information technology and operational technology to improve efficiency.”
Projects at Zurich-based Hitachi ABB Power Grids, whose annual orders of $10 billion are equivalent to 10 percent of Hitachi’s revenue, include connecting the world’s largest offshore wind farm in the North Sea to Britain’s power grid.
In China it is delivering some of the world’s longest powerlines, including a 1,700 km link to transmit hydro-generated electricity from Sichuan province to Jiangxi province.
Facchin said he was confident the business could beat the 2 to 3 percent growth annual growth rate for the $100 billion global power grid market.
The company, which employs 36,000, will tap Hitachi’s expertise in IT and digital technology to enable predictive maintenance of power grids, for example.
It will use Hitachi’s financing arm will to help clients fund projects, and increase its service business, Facchin said.
The Italian executive was confident he could raise profitability, which investors saw as a problem when ABB owned it.
It is targeting operational EBITA margins of 8 to 12 percent, up from 6.5 percent expected in the year to March 2021.
“We are going to be at the upper end of this corridor by 2025,” Facchin said.


Saudi regulator refers investors to Public Prosecution over $346m in suspicious trading

Updated 30 November 2020

Saudi regulator refers investors to Public Prosecution over $346m in suspicious trading

  • The investors were suspected of violating Article (49) of the Capital Market Law

The Capital Market Authority (CMA), announced today, Nov. 30, referring 22 investors to the Public Prosecution over suspicious trading in shares of Dar Al Arkan Real Estate Development Co., and making illicit gains of SAR 1.33 billion ($346.7 million).

The investors were suspected of violating Article (49) of the Capital Market Law and Article (2) of the Market Conduct Regulations, the market regulator said in a statement.

The claim was referred to the Committee for Resolution of Securities Disputes.

This came in line with the CMA’s efforts to protect the market from unfair as well as illegal practices, including deceit, cheating, fraud and manipulation, and to ensure market efficiency and transparency.

Last week, the CMA identified some cases suspected of manipulations, fraud and scam of the capital market rules and its executive regulations, amid the price fluctuations of some stocks, Argaam reported.

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