L&T, BEL gain on news of winning Rs 40,000-crore project

MoD has selected two consortia from the dozen companies invited to bid- L&T and Tata Power and the other between Rolta and BEL

Shares of L&T, BEL, Rolta India and Tata Power are trading high upto 7% on the BSE on Business Standard reports stating that the Ministry of Defence (MoD) has selected two consortia from the dozen companies invited to bid in November 2013. One is a consortium between Larsen & Toubro (L&T) and Tata Power, and the other between Rolta and Bharat Electronics Ltd (BEL). These winners - termed development agencies - could be announced any day.

The National Democratic Alliance (NDA) government is poised to award its first 'make' contract, in which the (MoD) will fund two Indian consortia in developing a Rs 40,000-50-000 crore 'battlefield management system' (BMS). This digital wireless network will interlink soldiers and battlefield sensors through voice and data channels, providing a common battle picture to each jawan.

Under the 'make' category of the Defence Procurement Policy of 2013 (DPP-2013), both consortia will develop separate prototype BMS systems, with the MoD reimbursing 80 per cent of the expenditure. A special MoD 'integrated project management team' (IPMT) will select the better prototype, and both consortia will then bid for the contract to mass-produce the BMS for the military.

The development and procurement of BMS networks is estimated to cost Rs 40,000-50,000 crore for the entire army. This includes developing the software and building hardware to interlink 500-900 soldiers in each of the army's roughly 500 combat units. Four types of custom-designed networks will cater to the army's armoured, mechanised, infantry and special forces combat groups.

While the BMS interlinks frontline soldiers, another mobile digital backbone network called the tactical communications system (TCS) connects them with commanders and support weapons in the rear, allowing the secure passage of reports, photos, data and verbal and written communication.

Two consortia are developing the TCS in India's first-ever 'make' project. BEL leads one, while the other comprises Tata Power, L&T and HCL.

L&T is up over 1%, BEL is up over 3%, Tata Power has gained over 1% and Rolta India has zoomed nearly 7% on the Bombay Stock Exchange (BSE).