It is my privilege to share the achievements and financial highlights of your Companyfor the financial year 2016-17 along with future growth plans of your Company.
The financial year 2016-17 turned out to be another eventful year ending with veryimpressive numbers surpassing the Moll targets. Your Company achieved the highest everSales Turnover of Rs.4886.62 Crore (which includes deferred revenue of Rs.7.05 Crore) andValue of Production of Rs.5011 Crore in FY 2016-17 with a Compound Annual Growth Rate(CAGR) of 39.89% during the last three years. This has been possible with your unstintedsupport and continued faith in the capabilities of your Company. Your Company is now allset to reach its new milestone of becoming a Rs.5000 Crore Company by the end of thiscurrent financial year.
On the financial front your Company continues to earn Profit with a consistent trackrecord of paying Dividend. Your Board has recommended a Final Dividend of Rs. 157.22 Crorefor the year 2016-17. (i.e. 128.67 % on the Paid-up Share Capital of Rs. 122.19 Crore).
HIGHLIGHTS OF THE YEAR
During the year your Company was able to achieve the installed capacity in theproduction of Akash SAMs which showcases our consistency in achieving the same. YourCompany has received a fresh indent worth Rs. 1650 Crore for an additional quantity of oneof the ATGMs from the Indian Armed forces.
I am very happy to share that your Company has bagged an Export Order worth USD 21.5Million for export of Light Weight Torpedoes (LWT). This is the first major export orderfor your Company after opening up
of exports for the defence products by the Government of India. I am confident thatyour Company would definitely capitalize on this opportunity expand its arms and startfocusing on increasing its customer base in the years to come. In this regard your Companyhad already identified certain potential products which are acceptable for exports.
Your Company is actively participating in various co-development programs of DefenceResearch and Development Organisation (DRDO).
During the year under report your Company issued 244375 Bonus Shares in the ratio of1:4 (one fully paid up equity share of Rs.1000 each for every four equity shares held) tothe shareholder. As a consequence the paid up capital of the Company has increased fromRs.97.75 Crore to Rs. 122.19 Crore.
Your Company has been given a target of Rs.5300 Crore of turnover in its MoU with theMinistry of Defence (MoD) for the year 2017-18. Your Company has a healthy order bookposition of Rs. 11170 Crore as on 31 March 2017 with the inclusion of fresh order for oneof the ATGMs. With the proposed Exports we are expecting an outstanding performanceduring the year 2017-18.
Further with the above handful of orders we believe our production lines would bebusy in the years ahead. Your Company will be having challenging times ahead with deliverycommitments with respect to major Surface to Air Missile (SAM) &ATGM projects.
In addition to the above your Company is also constantly participating in variousco-development programmes with DRDO. There are a number of new projects in the pipelinewhich are expected to be firmed up in the near future.
As stated above with the encouragement from MoD for exports your Company has workedon the export potential of our products to friendly nations. I am confident that effortsin this area of export would bear fruits in the coming years.
Moreover lands acquired at Ibrahimpatnam in Telangana State and Amravati inMaharashtra State will be put into use for new projects. Your Company has been able toaugment necessary infrastructure at multi locations set up manufacturing lines improveits Vendor base and also create effective Project Management Systems for timely executionof Projects.
During the current financial year your Company also inaugurated its new MarketingOffice in New Delhi to focus and coordinate export/business development activities.
It is not out of place to mention here that your Company is very much aware that itsNominated Production Agency status is being slowly transformed into that of a competitivegrid mode. In the last two years private sector participation in India's defence sectorhas been on the rise and large Indian private sector conglomerates have increased theirexposure to Indian defence market. This is facilitated by several policy interventions byGovernment support and specifically the 'Make in India' Programme. The impact of theseinitiatives has created more opportunities for domestic industry to tie- up with globaldefence companies for products and technologies. Increased focus on the Indian defencemarket by Indian private sector and global players is likely to further increase thecompetition for your Company in the coming years.
Shri AK Gupta IAS Secretary (Defence Production) inaugurated the Marketing Office ofBDL at New Delhi on 16 June 2017.
At this juncture I feel it is my duty to inform that during the current financial year2017-18 our Administrative Ministry has conveyed approval of the Cabinet Committee onEconomic Affairs for listing of Shares of the Company in stock exchanges by way of anoffer for sale of a part of the Government holding through Initial Public Offer. In thisregard the Department of Investment and Public Asset Management (DIPAM) Government ofIndia has already initiated the process and have appointed Book Runner Lead Managers tohandle the issue. I am privileged to say that your Company would soon become a listedentity and there would be a public participation in your Company.
As always your Company continues to be environment friendly and has been maintaining aclean and green environment in all its manufacturing units. Energy conservation measuresare being adopted at all the possible areas. The Company is committed to meet all thestipulated standards for maintaining and protecting the environment.
Your Company under Green Energy commitment to Hon'ble Prime Minister of Indiacommitted to set up 25 MW Grid connected Solar PV power plants in the units. Initiallyinstallation of 5 MW Grid connected Solar Power plant at Bhanur unit is in process. Thegenerated solar power will be connected to Telangana state electrical power grid atNandigama sub-station. Further your Board also approved for installation of 5 MW gridconnected Solar power project at the Ibrahimpatnam unit of your Company. The installationprocess would commence in the current financial year.
REGULAR INTERACTION WITH CUSTOMERS:
Modernization of Defence is the key growth driver for your Company. Your Company isorganizing periodical meetings with Users to know their requirements and also formonitoring the progress and supply status of the indents placed on the Company by theArmed Forces. At times the meetings are held under the aegis of MoD also. The Company ismaintaining total transparency in all its activities while supplying the items to theArmed Forces.
Your Company has been able to increase its Vendor base year by year. We consider ourvendors as partners in our growth. Our vendors play a critical role in our success story.As a result there is a lot of impetus to increase their capacities in order to meet ourdelivery timelines.
As per our New Vendor Development Policy your Company is able to further improveSupply Chain Management to meet the long term commitments of the Company and also toensure a transparent mechanism in identifying and developing new vendors. In line with theguidelines issued by Administrative Ministry outsourcing and Vendor Development Manual ofthe Company is under regular review and updation.
Under "MAKE IN INDIA" initiative we have published a list of items under animport substitutions category which needs to be supplied by indigenous vendors. We dependon our vendors both of domestic and international origin small medium and large in sizeto ensure prompt quality and cost effective supply of input materials to support ourvalue chain.
Your Company has adopted the strategy to conclude long term business agreements toensure timely delivery of materials at fixed prices. Your Company is constantly exploringopportunities for transfer/absorption of technologies by entering into strategicalliances/agreements to increase indigenous content.
CORPORATE SOCIAL RESPONSIBILITY AND SUSTAIN ABILITY DEVELOPMENT:
Corporate Social Responsibility is considered as an embedded programme of the Company.Your Company being a good Corporate Citizen has been playing an exemplary role byway offulfilling Social and Welfare obligations with transparency and commitment.
During the year under report your Company has spent an amount of Rs.l 3.1 8 Crore onvarious CSR activities namely Mid-day Meal construction of toilets Swachh BharatAbhiyan Skill Development Safe drinking water Health care Renewable energy etc.. YourCompany also identified villages in bothTelangana and Andhra Pradesh States under thevillage adoption programme to carry out CSR activities of the Company.
As a Corporate Social Responsibility initiative BDL has adopted Kyasaram village ofPatancheru Mandal Telangana State. BDL has constructed a Primary Health Centre CommunityHall Toilets in individual houses and in Government schools and installed a RO WaterTreatment Plant for providing safe drinking water. These were inaugurated on 10June2017.
AWARDS AND RECOGNITIONS:
Shri V.Udaya Bhaskar CMD BDL and Shri V.Gurudatta Prasad Director (Production) BDLreceiving the Raksha Mantri's Institutional Award for Excellence in Performance for theyear 2014 - 15 from Hon'ble Union Minister for Defence Finance and Corporate AffairsShri Arun Jaitley at Manekshaw Centre New Del hi on 30 May 2017.
Shri.K.Divakar Director (Technical) BDL and Shri M.Sreedhar Rao AGM (D&E)receiving Group 1 /Individual Award in Innovation category for the year I 2014-15 from theHon'ble Union Minister at I Manekshaw Centre New Delhi on 30 May 2017.
Hon'ble Union Minister for Defence Finance and Corporate Affairs Shri Arun Jaitleybeing briefed about BDL products by CMD BDL Shri V.Udaya Bhaskar on the side lines ofRaksha Mantri's Awards presentation ceremony held at Manekshaw Centre New Delhi on 30 May2017.
BDL has been awarded the SKOCH BSE Award for 'Business Excellence' by SKOCH Group. Theaward was received by Shri Shivanand S. Khanapet GM (NP & R) and Shri S. MuralimohanAGM (BD) on behalf of BDLon 20June2017 at Mumbai.
Your Company has a well established transparent and fair administrative set up toprovide for professionalism and accountability. The Philosophy of the Company in respectof Corporate Governance is to ensure transparency in all its operations make appropriatedisclosures comply with laws maintain ethical standards and take care of the interest ofall the stakeholders.
Management Discussion and Analysis Report and a Report on Corporate Governance based onguidelines issued by DPE Govt of India to Public Sector Enterprises along withcompliance certificate from a Practicing Company Secretary are annexed to Directors'Report.
Quarterly and Yearly Compliance reports on Corporate Governance are being forwarded toMoD in the prescribed format as per DPE Guidelines.
The Company's activities are monitored by several external agencies like StatutoryAuditors Comptroller and Auditor General of India Central Vigilance Commission Ministryof Defence (Department of Defence Production) etc.
I highly appreciate the support extended by our customers business associates andvarious Ministries of Government of India particularly Ministry of Defence Department ofDefence Production DRDO and the Three Services and their Inspectorates.
I wish to thank the Statutory Auditors of the Company and Principal Director ofCommercial Audit and Ex-Officio Member Audit Committee of the Board for the valuableadvice and cooperation extended by them. The dedication and commitment of our employeesand Executives at all levels continues to be the major strength of the Company.
My sincere thanks are due to my colleagues on the Board for their support and valuableadvice in all areas of the Management. We shall make continuous efforts to build on thesestrengths to face future challenges and sustain the growth momentum.
I am confident that with continuous dedicated efforts commitment and hard work yourCompany shall march forward to achieve greater heights in the years to come. We shall lookforward to a brighter future ahead.
With best wishes
| ||V UDAYA BHASKAR |
|Place: New Delhi ||Chairman and Managing Director |
|Date : 03/08/2017 ||DIN: 06669311 |