The Hindu Business Line : Bharat Electronics net rises 30%

Looking ahead
The PSU to spend Rs 180 cr for capital expenditure in current fiscal.
Plans to reduce dependence on defence contracts and grow its civil business.
Company's mission statement to focus on making BEL a globally competitive organisation in defence electronics.

Bangalore , April 17

Bharat Electronics Ltd (BEL) has posted a 30 per cent increase in net profit to Rs 581 crore during 2005-06 on a turnover of Rs 3,561 crore, which was 11 per cent higher than the previous year.

The BEL Chairman and Managing Director, Mr Y. Gopal Rao, told newspersons on Monday that the public sector was aiming to achieve a turnover of around Rs 5,000 crore by 2007-08 and expects it to double by 2011-12.

BEL also plans to spend around Rs 180 crore towards capital expenditure for the current fiscal (2006-07). The entire amount will be funded through internal resources. BEL has a corpus of around Rs 600 crore which has been earmarked for investment purposes. Over the last three years, the public sector has been making savings of between Rs 80 crore and Rs 100 crore every year through cost reductions. Mr Gopal Rao said the share of the revenues from the civil segment would gradually increase to around 25 per cent of the total turnover.

"We don't want to depend only on defence contracts because the policies keep changing.

To balance our business portfolio, we need to grow our civil business," he said.

During 2005-06, revenues from the civil segment grew 25 per cent to Rs 500 crore and is expected to double to around Rs 1,000 crore during the current fiscal.

Mr Rao said the public sector has an order book position of around Rs 6,600 crore compared with Rs 6,100 crore as of April 1, 2005. All the nine units of BEL continue to be profitable.

He said the mission statement of the public sector has been revised.

The statement focuses more on making BEL a globally competitive organisation in defence electronics and in other areas of professional electronics.

BEL achieved exports of $13.58 million in 2005-06, which was 9 per cent higher than the last year.

Its joint venture with GE, in which BEL has 24 per cent stake, had a turnover of around Rs 400 crore.

Over 70 per cent of its turnover came from indigenously developed products, which was 10 per cent more than the last year.

BEL also won two patents during the course of the year. It won a patent for its electronic voting machines and another for solar powered traffic signalling systems. Mr Rao said the design of simputer is undergoing design changes and the focus too has shifted to the enterprise segment.