The Hindu Business Line : BHEL Hyderabad clocks Rs 630-cr profit before tax

Hyderabad April 5 The Hyderabad unit of Bharat Heavy Electricals Ltd has posted Rs 630-crore profit before tax in the fiscal year ended March 31, 2007 compared with Rs 615 crore earned in the previous fiscal.

The turnover moved up to Rs 2,860 crore during the year as against Rs 2,672 crore clocked in the fiscal year 2005-06, Mr G.V. Rami Reddy, Chief Executive, BHEL, Hyderabad, told newspersons here on Wednesday.

Increased competition from global majors, pricing pressure and a lean order book hindered the performance of BHEL's unit here in the just ended fiscal.

"During the year, we confronted growing competition amidst high pricing pressure. Increased competition from MNCs, especially from China and a lean order book impacted our performance,'' Mr Reddy said. The unit had orders worth Rs 28 crore last year. The unit had executed some 2007-08 orders in the last fiscal itself, which helped it in achieving Rs 2,860-crore turnover, he added.

The export turnover of the unit doubled to Rs 596 crore from Rs 261 crore in the corresponding period of previous fiscal. "This is more than half of the corporation's exports of Rs 1,029 crore and represents a jump of 30 per cent over the previous fiscal,'' Mr Reddy said. The unit received the first compressor order from the European market and would be supplying a steam turbine and compressor train to Grande Paroisse, France.

Claiming that the unit would repeat the sterling performance it staged in year 2005-06 in which profit jumped Rs 295 crore in the present fiscal year, he said the unit currently had an outstanding order book of Rs 6,000 crore including Rs 950 crore order from Bharat Oman Refinery Ltd for a PET Coke-based EPC, among others.

Gas turbines, oil rigs

To improve profitability, the unit would focus on its gas turbines and oil rigs business. "In view of the gas finds in K-G basin, Rajasthan and Mahanadi in the country and many places outside India, we are augmenting our infrastructure and R&D expertise on these lines," he said.

Similarly, in supercritical power segment, the unit tied up with Mitsubishi of Japan and Alstom of France to upgrade its deliveries.

To tackle the competition and expand its reach, the unit has lined up Rs 900 crore investment in the XI Plan. "Most of the investment would go in modernising the infrastructure which allows us to capture the domestic as well as global markets," Mr Reddy said.

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BHEL Hyderabad clocks Rs 630-cr profit before tax