Amid the rapid rollout of smart meters and ongoing reforms in the power distribution sector, Polaris Smart Metering is looking to expand its business by offering technology solutions to other smart metering companies, scale up its international presence, and explore a public listing of its shares in India.
Yashraj Khaitan, founder and chief executive of the company, told Mint in an interview that the company, which currently holds nearly 10% market share in the Indian smart metering space, aims to double its share in the next three to five years.
Khaitan did not give a timeline for its public listing plans, but emphasized that the company is well-capitalized for expansion. “We are certainly looking at hitting the public markets. As soon as I Squared decides, we'll be looking at it.”
US-headquartered private equity firm I Squared Capital holds a 51% stake in the company and last invested $100 million in 2023.
Growing segment
Smart metering is a rapidly growing segment in the country, with significant potential driven by the government’s ambitious push under the Revamped Distribution Sector Scheme (RDSS). The scheme initially targeted the installation of 250 million smart meters nationwide by March 2026, but amid slower-than-expected progress, the timeline has since been extended to March 2028.
So far, 47.6 million smart meters have been installed in the country, and over 203 million meters have been sanctioned under the RDSS scheme. Listed companies present in this business include Genus Power Infrastructures Ltd, Adani Energy Solutions Ltd, Tata Power Co. Ltd and HPL Electric and Power Ltd. Energy Efficiency Services Ltd-backed IntelliSmart and Secure Meters are other major players.
Smart meters are expected to offer consumers greater convenience through features such as prepaid recharge options, emergency credit to avoid disconnection due to zero balance, and real-time tracking of electricity consumption. At the same time, they help distribution utilities improve billing and collection efficiency, while offering benefits such as automated energy accounting, improved load forecasting, the use of data analytics for demand-side management, and the creation of an enabling ecosystem for the energy transition.
International play
The Polaris CEO said that out of the sanctioned meters, the company would install nearly 10% across the country. As an Advanced Metering Infrastructure Service Provider (AMISP), Polaris currently holds an order book of approximately $1.1 billion, covering projects across Uttar Pradesh, West Bengal, and Manipur for smart electric meters.
“$150 million is what they (I Squared Capital) are putting into the platform. A good chunk of that has already been invested, but all the capital is committed to us… So I would say that we have adequate capital to grow in our current business. We will start exploring... and I Squared is again fully committed to investing more capital into the business. But I mean, we may be looking at access to more capital when we look at international expansion,” Khaitan said while speaking about the capital requirement.
He said the company would be looking to acquire companies internationally to enter those markets inorganically, for which he added that the company would have to consider raising more funds.
Noting that the AMISP business model is expected to be successful globally as well, the CEO said Polaris Smart Metering would look to leverage I Squared Capital's global experience in investment portfolios to expand its business in other countries.
“In our international plays that we are looking at... I Squared is present on almost every continent in the world, except Antarctica. I Squared is present in all the core infrastructure industries globally. So that gives us a lot of leverage because since I Squared is already present in the core infra play in most of these countries, we are able to get access to utilities in countries easily,” he said.
He said the company is currently looking at South-East Asian and African markets to expand its smart metering business.
On the expansion plans for its manufacturing capacity, he said it would more than double its smart meter manufacturing capacity from the current 5 million meters per year. The planned plant in Rajasthan, he said, would be commissioned within one year. “In fact, we are setting up the country's single-largest manufacturing plant in Rajasthan. As we speak, we already have a manufacturing capacity of over 5 million meters per year. But we are significantly expanding that.”