HALs Light Utility Helicopter (LCH)

Hindustan Aeronautics Ltd (HAL) is getting a lot of enquiries from various countries, including the Philippines, UAE and Argentina. CB Ananthakrishnan, CMD of HAL, said that the Philippines and UAE are showing interest in their helicopters. The company is in discussions with orders from Argentina as well for helicopters reports 100knots.

He expects positive results from Argentina orders. “We are in discussions with Argentina for helicopters. We expect that order should come through,” he said. The company keeps getting a lot of inquiries and leads from various countries. “But at the end of the day, how much of these leads will get converted into business, we will have to wait and see,” he added.

In addition to the TEJAS, Argentina is also interested in the LCH, while the Philippines and Egypt have expressed interest in the ALH. “Argentina has been interested in the TEJAS and we have submitted a proposal,” he stated.

India has been giving helicopters, mostly ALH, to friendly countries in the Indian Ocean Region. The helicopter production capacity of HAL currently is 30 per year at Bengaluru and 30 at the new plant at Tumkur which can be scaled up to 60 per year when required, Mr Ananthakrishnan explained. So we can ramp up the production rate to 90 helicopters per year, he noted.

In early September, the Cabinet Committee on Security (CCS) give sanctions for the development of the TEJAS MK-2, a bigger and more capable fighter than the present one. “We will be able to deliver the prototype in 2025-26 and have the first flight in 2026-27,” Mr Ananthakrishnan added.

The CCS sanction includes a total development cost of INR 9,000 crore including the INR 2,500 crore that has already been spent. IAF has committed to procuring six squadrons of TEJAS MK-2.

The TEJAS MK-2 will be a heavier and much more capable aircraft than the current LCA variants and the TEJAS MK-1, 83 of which have been contracted under an INR 48,000 crore deal with Hindustan Aeronautics Limited (HAL). The Mk2 is 1350mm longer features canards and can carry a payload of 6500kgs compared to 3500kgs the LCA-Mk1 can carry.

The MK-2 will be powered by the General Electric GE-414 engine which produces 98kN thrust compared to the 84kN thrust of the GE-404 engine powering the TEJAS MK-1 and MK-1A.

Union Budget 2023 is around the corner. When asked about his expectations from the budget, he replied, “We expect the budget to be comfortable to HAL and necessary allocations will be made so that as and when the orders materialise, we will not have any cash flow issues as far as new contracts are concerned.”

The Indian army has ordered nearly 2,000 unmanned aerial vehicles popularly known as UAVs of various types since the start of the stand-off that took place at Galwan with China in 2020.

Previously, in the quarter two earnings conference call, the HAL management mentioned that they are developing one rotary UAV of 200 kg class. While updating on that order opportunity, Ananthakrishnan said the company is not involved in the 2,000 UAVs that the Indian Army has ordered and is focusing on combat drones.

“As far as the Indian army having placed around 2,000 drones order is concerned, it is basically towards mini and small UAV segments and HAL is not into that. Our focus is towards the combat drones, which we are trying to develop,” he added.

Drones will be used for logistical purposes that can carry loads between 5 kg & 40 kg to troops in forward posts.

The current order book of the company stands at INR 84,000 crore. Apart from this, there is also visibility of orders worth INR 36,000 crore to be materialised in the next six months to one year. Repair and overhaul orders will be an additional INR 15,000 crore.

“In the short-term, there is an expectancy of around INR 36,000 crore, which should materialise in the next six months. Repair and overhaul orders will be an additional order of almost INR 15,000 crore over and above this on an annualised basis,” he said.

The company expects revenue growth of 8% in FY23 and FY24 and double-digit revenue growth from FY25 onwards. While updating about the Malaysian order that the company was expecting, he said that the probability of a Malaysian order is reducing.

“We so far have not got any communication on whether it is awarded to anyone else other than HAL but as it looks like, the probability of the Malaysian order does not seem to be very bright. However, we are still hopeful of the order,” he explained.

HAL has a full-fledged production facility for manufacturing cryogenic engines. The company is working in collaboration with Indian Space Research Organisation (ISRO). “As and when the orders come from ISRO, we will be in a position to manufacture those engines and supply it to them,” he said.

ISRO’s cryogenic engine orders are close to INR 700-800 crore. “We expect it to keep growing as and when the requirement of ISRO keeps going up,” he said.