Indian Government to Divest Stake in BDL
The Indian government plans to divest a 15% stake in state-owned missile manufacturer Bharat Dynamics Limited (BDL), it was announced on 7 September.
The share sale, which is expected to generate funds of up to Rs 907 crore (USD123.5 million), follows the government’s divestment of a 14.8% stake in Hindustan Aeronautics Limited (HAL) in late August.
In a filing to the Bombay Stock Exchange (BSE) BDL said that the government share offer could feature nearly 27.5 million shares and will proceed over two stages.
In the first, the government will sell on Indian stock exchanges 18.32 million BDL shares – or a 10% government stake – from 8 September. If this offer is oversubscribed, the government will divest an additional 5% stake, or 9.16 million shares, from 9 September.
The shares will be sold at Rs 330 each. On 8 September BDL’s shares were trading at about Rs 385 each. The government also sold off a 12.25% stake in BDL through an initial public offering (IPO) in March 2018. The listing raised Rs 960 crore.
In fiscal year 2019-20 BDL, which is based in Hyderabad, registered an annual turnover of Rs 3095 crore and a net profit of Rs 535 crore. These represented year-on-year increases of 1% and 27% respectively. On announcing its results in July the company said that its defence business activities had not been impacted by Covid-19.
Tata and L&T Get Orders for Pinaka Rocket Launchers
The Defence Ministry sealed a deal, on 31 August, Tata Power Company Ltd (TPCL) and engineering major Larsen & Toubro (L&T) to procure Pinaka Multiple Launch Rocket System (MLRS) for six Army regiments at a cost of Rs 2,580 crore. Bharat Earth Movers Ltd (BEML) will also be part of the project. It will supply the vehicles on which the rocket launchers will be mounted.
This is a flagship project showcasing public-private partnership under the aegis of government of India (DRDO & MoD) enabling ‘Aatmanirbharta’ in cutting edge defence technologies. The weapons systems will have 70 per cent indigenous content.
The Pinaka MLRS has been indigenously designed and developed by DRDO. Six Pinaka regiments comprise 114 launchers with Automated Gun Aiming and Positioning System (AGAPS) and 45 command posts. The missile regiments are planned to be operationalised by 2024.
Russian Deal For AK-203 Rifles Nearly Done
The deal between India and Russia for the production of 6 lakh AK-203 rifles under the ‘Make in India’ policy has reportedly been finalised and the process is set to start soon. The AK-203 is a new version of the legendary AK-47 assault rifle.
India’s troops have been waiting to get their hands on a state-of-the-art rifle for some years now. The border clashes with China this year have only magnified the urgency of quickly shoring up India’s firepower – and the modernised AK-203 rifles are a step in that direction.
India has also reportedly doubled the order for the initial batch of the 72,400 American Sig Sauer assault rifles amid the ongoing tensions with China but the bulk of the replacements for the INSAS rifles will be the AK-203, manufactured in Uttar Pradesh’s Amethi.
While both the AK-203 and INSAS have a rotary bolt-locking system and are gas operated, the former’s enhanced grip, foldable and adjustable buttstock, and an extra finger trigger tab give it the clear edge.
While the INSAS (5.56 x 45 mm) can be used in a three-round burst and single shot mode, the AK-203 (7.62 x 39 mm) has a semi-automatic and automatic mode.
The AK-203 also has the advantage of being the lighter among the two rifles. Further, the AK-203 has clinical accuracy and carries more bullets. Like the INSAS, the AK-203’s effective range is around 400 metres.
The AK-203 is a world-class, all-weather durable rifle that can carry a knife-bayonet or 40-mm under-barrel grenade launcher, according to the Kalashnikov website. It also comes with a side dove-tail mounting rail that enhances night sights.
The fire accuracy of cyclic bursts is far superior thanks to the AK-203’s muzzle brakes.
BEML Bags High Mobility Vehicles Order
BEML Limited, the leading Defence equipment manufacturer and a ‘Schedule A’ Company under the Ministry of Defence (MoD) received a prestigious order from MoD for supply for 330 High Mobility Vehicles, for Pinaka Project at an approximate cost of Rs 842crore.
The multi-barrel launcher system is mounted on the highly rugged BEML truck, much acclaimed for its off-road mobility and would provide the Indian Army with vital manoeuvrability on the battlefield.
This order is a big boost to BEML, involved in the manufacturing of the High Mobility vehicles with superior features under the ‘Make in India’ programme, thus demonstrating BEML’s efforts under the ‘Aatmanirbhar Bharat’ initiative. The equipment will be manufactured at BEML’s Palakkad Plant in Kerala and would supply the vehicle platform to MoD in a span of three years.
HAL Light Utility Helicopter Completes Hot and High-altitude Trials
Hindustan Aeronautics Limited’s (HAL) indigenously developed Light Utility Helicopter (LUH) completed the hot and high-altitude trials in the Himalayas, at Daulat Beg Oldie (DBO) over 10 days, according to a HAL release on 9 September.
A comprehensive test plan was executed at Leh (3300 meters above mean sea level) in temperatures up to ISA (international standard atmosphere)+320C which included envelope expansion, performance and flying qualities, HAL said.
The LUH took off from Leh and demonstrated its hot and high hover performance at DBO Advanced Landing Ground (ALG) at 5000 metres altitude.
The helicopter also demonstrated its payload capability in Siachen glacier high altitude. During the trials, pilots landed the helicopter at the highest helipads of Amar and Sonam.
The Army version of LUH is now ready for Initial Operational Clearance, said HAL CMD, R Madhavan.
The Initial Operational Clearance for basic LUH was accorded by Centre for Military Airworthiness and Certification (CEMILAC) for the IAF variant on 7 February 2020, HAL said.
BEL Upbeat on Defence Business Performance
Bharat Electronics Limited is upbeat about its business prospects in the Defence sector though it was facing the prospect of short-term adverse impact from COVID-19. BEL had an order book of Rs 51,973 crore as on 1 April this year.
Defence contributed 82 per cent of sales revenue of BEL in 2019-20, up from 68 per cent in the previous fiscal. The remaining 18 per cent revenue came from the non-defence sector. The company said 79 per cent of its turnover in 2019-20 came from indigenous products.
BEL achieved a turnover of Rs 12,608 crore during 2019-20, a growth of 6.94 per cent compared to the previous financial year.
BEL’s Chairman and Managing Director M V Gowtama said the Government’s emphasis on ‘Make in India’ in the Defence sector provides a great opportunity for the company to enhance indigenous efforts and to address the emerging opportunities.
According to the 2019-20 annual report, the internal study and analysis predict that COVID-19 may impact the company’s operations in the short-term in terms of deliver schedules. However, on a long-term basis, it is likely to have a less impact on the company’s operations and performance.
Centre Asks UP to Speed Up Land Acquisition for Defence Corridor
The Yogi Adityanath government has been asked to speed up the ambitious UP Defence Corridor project, especially, the land acquisition exercise. The corridor is expected to come up over nearly 5,000 hectares across six nodes — Aligarh, Agra, Jhansi, Chitrakoot, Kanpur, and Lucknow.
Nearly 90% or more than 1,300 hectares of total 1,461 hectares approved so far has been acquired by the state across different nodes for the Rs 20,000 crore project.
Different manufacturing projects totalling a proposed investment worth Rs 3,732 crore have also been announced. These investments include Rs 1,077 crore by Hindustan Aeronautics Limited (HAL), Rs 1,200 crore by Bharat Electronic Limited (BEL), Rs 240 crore PTC Industries, Rs 200 crore Bharat Forge and Rs 900 crore by Kanpur-based MKU.
The state government authorities were also directed by the Centre to work in close coordination with the investors to redress their grievances and speed up the projects.
Process for the identification of land on Lucknow outskirts and outside the Taj Trapezium Zone (TTZ) in Agra districts was on.
According to UP additional chief secretary and UP Expressway Industrial Development Authority (UPEIDA) CEO Awanish Awasthi, so far 32 MoUs had been signed for projects related to UP Defence Corridor. He also claimed that proposals from investors based in South Korea and Ukraine were also received by the state government. Titan Aviation and Aerospace India Limited have planned investment to the tune of Rs 36,000 crore in Jhansi, for which the detailed project report (DPR) had been submitted.
Indian Navy has also signed an MoU with UPEIDA for setting up a ‘Centre of Excellence’ in the Defence Corridor to promote research and innovation in defence sector.
Business Suspended With Vectra Advanced Engineering
The Defence Ministry has suspended all business dealings with Vectra Advanced Engineering Private Ltd for one year in view of a probe by the CBI into the allegations of wrongdoings against it in the Tatra Truck deal from 14 August.
In 2012, the then Army Chief Gen VK Singh had claimed that he was offered a bribe of Rs 14 crore to approve the procurement of a batch of 600 “sub-standard” Tatra trucks for the Indian Army.
