Slackness in large infra projs pose challenges: Bhel

Reflecting tough conditions, the company saw its net profit in the first 6 months of current financial year decline to Rs 921 crore

State-owned Bhel, which is focusing on a multi-pronged strategy to boost business, has said slackness in large infrastructure projects and stagnation in domestic power sector are posing challenges.

Bharat Heavy Electricals Ltd (Bhel), a $9 billion engineering and manufacturing enterprise, is grappling with tough business environment including sluggishness in the power sector.

According to a presentation made at a conference this month, Bhel said it is "facing challenges from several fronts" such as slackness in large infrastructure projects, stagnation in domestic power sector, slowing Indian economy and rising competition.

Besides, the company listed disturbances in target export markets, uncertainties in global economy and skill deficit, among others, as challenges for its business.

Cheaper imports of equipment, especially from China, has been negatively impacting Bhel's business.

Reflecting tough conditions, the company saw its net profit in the first six months of current financial year decline to Rs 921 crore. During this period, the firm received orders worth Rs 4,470 crore.

The total order book stood at Rs 1,02,380 crore at the end of September 2013. Despite multiple challenges, Bhel said, there are "huge market opportunities" in Indian power sector.

Bhel has a manufacturing capacity of about 20,000 MW.

The company is focusing on a six-point agenda to realise its strategic targets by 2017. As part of that plan, Bhel will focus on capability, accelerated project execution, product cost competitiveness, diversification, engineering and technology, and people development.