Bharat Electronics Limited is upbeat about its business prospects in the Defence sector seeking to ride on the Government’s thrust on self-reliance though it’s facing the prospect of short-term adverse impact from COVID-19.
In fact, the Bengaluru-based Defence PSU was sitting on an order book of Rs 51,973 crore as on April one this year, according to company officials.
Defence contributed 82 per cent of sales revenue of BEL in 2019-20, up from 68 per cent in the previous fiscal.
The remaining 18 per cent revenue came from the non- defence sector.
BEL’s Chairman and Managing Director M V Gowtama said the Government’s emphasis on ‘Make in India’ in the Defence sector provides a great opportunity for the company to enhance indigenous efforts and to address the emerging opportunities.
The Navratna PSU under the Ministry of Defence achieved a turnover of Rs 12,608 crore during 2019-20, a growth of 6.94 per cent compared to the previous financial year.
“BEL is targeting a healthy growth of 12-15 per cent during 2020-21”, Gowtama said in a September seven letter to the shareholders.
The real impact of the pandemic on the company is to be seen in the near future as the situation is evolving, he said, adding, however, that it has started taking mitigation measures to reduce the impact.
According to the 2019-20 annual report, uploaded on BEL’s website last week, the internal study and analysis predict that COVID-19 may impact the company’s operations in the short-term in terms of deliver schedules.
“However, on a long-term basis, it is likely to have a less impact on the company’s operations and performance”, it said.
BEL said it does not foresee any fall in the demand for its products and services in the Defence segment due to the COVID-19 impact on a long-term basis.
However, there might be a little delay in order acquisition in the short-term, the company said.
Enhanced focus of the Government on self-reliance (‘AatmaNirbharBharat Abhiyan’) is likely to boost the company’s business prospects as a leading indigenous solutions provider in the Defence sector, it said.
This thrust will have a favourable impact on the company’s performance in the coming years, according to BEL.
The company said 79 per cent of its turnover in 2019-20 came from indigenous products.