Bharat Electronics Bullish On Grown Prospects

Atul Chandra
13 Feb 2023
02:53 PM
4 Min Read

BEL continues to be a profit-making PSU, despite challenges posed by the pandemic, global chip shortage and stiff competition. In FY22 it registered 9% growth in turnover to INR 15,044 crore

Bhanu Prakash

Bhanu Prakash Srivastava joined BEL in August 1986 and had a career spanning 36 years in three Units of BEL. His contributions during his tenure include sustained business growth and profitability in radio & data equipment, military and telecom switching equipment, C4I systems for civil and military applications, radars for Army, Air Force and Navy, Sonars, fire control systems & communications for the Navy and surface-to-air missile project for naval ships.

What are the products that Bharat Electronics Limited (BEL) is presenting at Aero India?

BEL will showcase state-of-the-art products and systems spanning every domain of its business at the 14th edition of Aero India 2023. The products and systems to be on display have been clustered as ‘Communication’, ‘Electro-Optics and Laser’, ‘EW and Avionics’, ‘Homeland Security & Smart Cities’, ‘Medical Electronics’, ‘Naval Systems’, ‘Network Centric Systems’, ‘Radar and Fire Control Systems’, ‘Tank Electronics and Gun Upgrade’, ‘Weapon System’, and ‘Outdoor Display Products’. In addition, BEL will also showcase its R&D capabilities by launching / demonstrating some of its new products and technologies. The company has set up an Experience Centre at its stall to showcase its Voice Analysis Software and Augmented Reality/Virtual Reality for Universal Simulator. 

The highlight of BEL’s outdoor display will be Weapon Locating Radar (mountain version), Akash Air Defence System, Anti-Radiation Decoy System, Surveillance Radar, Air Defence Fire Control Radar, Automatic Manpack SATCOM Terminal, Anti Drone System and Mobile Communication Terminal. 

Can you update us on BEL’s financial performance? 

BEL continues to be a profit-making PSU, despite challenges posed by the pandemic, global chip shortage and stiff competition. FY22 saw the company registering a record turnover of INR 15,044 crore, a growth of 9% over the previous year. BEL became the first Defence PSU to cross the landmark market capitalisation figure of INR 80,000 crore and declare the highest-ever dividend of 450%. The company has increased its authorised capital three-fold to INR 750 crore and issued bonus shares in the ratio 2:1. This year, we are confident of continuing the good show and achieving revenue growth of 15% and an EBITDA margin of 21%-23%. 

What about exports?

BEL recorded an export turnover of $33.30 million during FY22. Major products exported by BEL included the Coastal Surveillance System (CSS), Trans-Receive (TR) Modules, EO-IR Payload System, Compact Multi-Purpose Advanced Stabilization System (EOS CoMPASS), Solar Hybrid Power Plant, Data Link, Electro-Mechanical parts, Low Band Receivers (LBREC), Medical Electronics, Spares for Radars, etc.

BEL is fast expanding its global presence, putting its best foot forward to give a thrust to exports worldwide. All-out efforts are being made to tap new global markets, including the Indian Ocean Region (IOR) and friendly foreign countries (FFCs). 

The Government is encouraging defence exports through many policy initiatives and has set a target of INR 35,000 crore by 2025. BEL has identified Exports & Offsets as one of its thrust areas and has drawn up plans to offer its select products and systems to various export markets. 

Some other products and systems being promoted for exports include Homeland Security solutions, Smart City solutions, Border Protection Systems and CSS. Having established a CSS for a few neighbouring countries, BEL is interacting with the Ministry of External Affairs for the supply of CSS to other friendly countries. 

BEL is also focusing on offset as a potential avenue for revenue generation. BEL interacts with many foreign OEMs to meet offset obligations in various MoD programmes. BEL has identified contract manufacturing (build-to-print and build-to-spec) for foreign OEMs and partnerships in the form of the transfer of technology of the latest systems and solutions as areas of emerging export opportunities. Efforts are also on to establish long-term supply chain relationships with global players.

What are the updates on BEL’s foray into the civilian domain?

Defence, being the mainstay of BEL, has traditionally been contributing to around 80% of the company’s annual sales revenue. BEL, however, has been continuously exploring opportunities in allied non-defence areas. The company aims to increase its non-defence share in the overall business in the coming years. 

Some of the areas BEL is focussing on in non-defence include solutions for the Civil Aviation sector, including Air Traffic Controller Radars, Anti Drone systems, Space / Satellite Electronics, Satellite Assembly & Integration, Unmanned Systems, Solar Business, Railway and Metro solutions, Software as a Service, Network & Cyber Security, Energy Storage products for Electric Vehicles (Li-ion & Fuel Cells, Charging Stations, etc), Homeland Security & Smart City businesses, Smart Meters, a range of Medical Electronic and health care solutions, Artificial Intelligence,Communication Radios & Networks,Composite Shelters & Masts, etc. This wide bouquet of businesses in non-defence would play a key role in driving BEL’s growth in the coming years.   

What initiatives has BEL taken to promote MSMEs?

The defence sector is being opened up for private sector participation with the evolution of the Defence Procurement Procedure. In this changing business scenario, BEL focuses on enhancing interactions at various levels and building long-term relationships with customers, emerging strategic partners and other key stakeholders in the Indian defence industry as a trusted and committed partner. 

Be it the efforts that the company has been putting in to engage in collaborative R&D in addition to augmenting its R&D set-up — its recent attempts to outsource work to Indian private industries and MSMEs, or the path-breaking decision to go in for Public-Private partnerships to execute turnkey projects, BEL is leaving no stone unturned to ensure that it is in sync with the Government’s larger goal of indigenisation and self-reliance. 

BEL has formulated a long-term Outsourcing and Vendor Development Policy and has taken several initiatives to broaden the domestic vendor base by implementing online vendor registration and e-procurement processes, including GeM. This is in line with the ‘Make in India’ initiative, where enhanced thrust has to be put into developing domestic players. Make in India Display Cells have been established at all units of BEL. The procurement from MSMEs by BEL has been over 20% in the previous years. BEL also participates in various events organised by the Government of India to promote MSMEs. 

Startup India is the Government's flagship initiative, intended to build a strong ecosystem conducive to startup businesses' growth, drive sustainable economic growth and generate large-scale employment opportunities. BEL has identified several areas for partnership with start-ups in emerging areas, including Machine Learning, Cyber Security, AI, Embedded Computing and other latest technologies that can be used for defence electronics applications. 

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