Six of the seven new defence companies created by the corporatisation of the Ordnance Factory Board (OFB) last October have reported provisional profits during the initial six months of their business from October 1, 2021 to March 31, 2022, the Defence Ministry said on Friday.
“Within the first six months, then new companies have achieved the turnover of more than ₹8,400 crore, which is significant considering the Value of Issue of erstwhile OFB during the previous financial years.”
Except Yantra India Ltd. (YIL), all other companies — Munitions India Ltd. (MIL); Armoured Vehicles Nigam Ltd. (AVANI); Advanced Weapons and Equipment India Ltd. (AWE India); Troop Comforts Ltd. (TCL); India Optel Ltd. (IOL) and Gliders India Ltd. (GIL) — have reported provisional profits, the statement said.
The Ministry stated that within a short time since their inception, these companies have been able to secure domestic contracts and export orders valuing more than ₹3,000 crore and ₹600 crore respectively. The MIL has bagged one of the biggest ever export order of ammunition of ₹500 crore.
These companies are also taking measures for developing new products through in-house as well as collaborative efforts. The YIL has bagged orders of about ₹251 crore from the Indian Railways for axles.
After the dissolution of the OFB, all outstanding indents with the erstwhile OFB were grandfathered and converted into deemed contracts valuing about ₹70,776 crore. Against the targets for Financial Year 2021-22, ₹7,765 crore was credited to the new defence companies as 60% mobilisation advance before the commencement of business date. An amount of ₹2,765.95 crore has been released to the seven new companies during the current financial year for capital expenditure and equity, the Ministry said.
The new entities have been able to make cumulative savings of about 9.48% in areas like overtime and non-production activities during the initial six months itself, the statement added.
