M&M targets Rs 83k cr revenue from defence sales

Mahindra & Mahindra today said it is eyeing a revenue of up to $18 billion (Rs 83,000 crore) in the next 8-10 years through the supply of various defence equipments in India.

"Mahindra & Mahindra Group is looking at a revenue of about $15-18 billion through its land, aerospace and naval equipments in the next 8-10 years in India," Mahindra Defence Systems CEO Khutub Hai said.

Some of the revenues will start accruing from next fiscal, he said, adding that as of now, the group's revenue from the defence supply business is very insignificant.

As per an estimate, the Ministry of Defence has earmarked a capital expenditure of about $100 billion on equipment purchases over the next 7-8 years.

At present, 70% of the country's defence equipment is imported, Hai said.

"What we envisage is that going forward, with Indian companies developing capabilities, supply of defence equipment from domestic sources can account about 50% of the requirement," he added.

Mahindra & Mahindra is looking to develop infantry combat vehicles and artillery systems under its product portfolio expansion plans.

The group is also in advanced stages of forming a joint venture with a multi-national player for the supply and manufacture of naval defence equipment.

However, Hai declined to comment on the investment required to meet the target revenues, saying that most of the capital requirement was only finalised after getting orders from the government.

At present, the investments were mainly being made on human resources training overseas and developing capabilities.

The group is also looking to become a leader in the global market for aerospace components, assemblies and completed aircraft over the next few years.

Recently, the company handed over six Mine Protected Vehicle-India (MPV-I) units that were developed by Defence Land Systems India -- a JV between Mahindra & Mahindra and BAE Systems Plc -- to the Jharkhand Police to mark the commencement of serial production of landmine protected vehicles from its Prithla plant, near Faridabad.

The company is looking to sell about 100 MPV-Is next fiscal, as it expects to bag big orders from the Home Ministry for the CRPF and other state police forces.