State-owned fighter jet maker Hindustan Aeronautics Ltd. has filed to launch an initial public offering as the government looks to sell 10.8 percent stake in India’s largest aerospace company. It plans to raise up to Rs 1,500 crore in the share sale.
HAL is crucial to Prime Minister Narendra Modi's plan to cut dependence on defence imports. The government is pushing local manufacturing by encouraging private companies to tie up with overseas manufacturers. Orders could cross $200-billion over the next decade, according to research and brokerage firm Bernstein.
Here's what HAL makes...
HAL had an order book of Rs 63,333 crore at the end of July, mostly for 35 Sukhoi Su-30 MKIs and 73 Dhruv Advanced Light Helicopters, according to its draft red herring prospectus. These are to be delivered over the next three years.
- Sukhoi Su 30 fighter aircraft.
- Indigenous light combat aircraft.
- Intermediate jet trainer.
- Advanced light helicopter.
- Dornier 228 turboprop.
- Cheetal helicopter.
- AL-31FP engine (for Sukhoi 30s).
- Jaguar fighter jet upgrade.
- Mirage fighter jet upgrade.
- Unmanned aerial vehicles: HAL designed and developed an 8-kilogram mini-drone for the armed forces. It also plans to offer larger UAVs with the Rustom-II medium-altitude, long-endurance UAV, being jointly developed by the Aeronautical Development Establishment, a research arm of the Defence Research and Development Organisation.
- Multi-role helicopters: HAL is developing a multi-role helicopter—used for assault and logistics—for the civilian market.
- Fifth generation fighter aircraft: It’s has struck a joint venture with with a Russian company for design and development of the fifth-generation fighter aircraft after Sukhoi.
The company’s operations are organised into five categories...
- Bangalore Complex
- MiG Complex
- Helicopter Complex
- Accessories Complex
- Design Complex
Together, these include 20 production facilities and 11 R&D centres across India.
Sukhoi Project Ends In Three Years
HAL’s biggest project of executing the Sukhoi order, which contributed 44 percent to its revenue in the year to March, is nearing completion, according to its draft red herring prospectus. The company has already supplied about 190 of the 222 fighter jets and the rest will be delivered in three years. The company makes the Sukhois at its Nashik facility.
Tejas: The Next Big Bet
HAL is making the light combat aircraft Tejas, which got initial operational clearance in December 2013 and awaits the final nod. The Indian Air Force accepted two Tajas aircraft in March and April last year. HAL has set up infrastructure to produce eight planes a year and is looking to double the output.
It’s also developing a drooped-nose version to meet the Navy’s demand, along with the landing gear and equipment required for operations from an aircraft carrier.
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