Letters of Offer from MoD for five Fleet Support Ships, two mini submarines worth Rs.13,000 Crore
VISAKHAPATNAM: The Hindustan Shipyard Limited, the largest on the East Coast, has received letters of offer from the Ministry of Defence for construction of five Fleet Support Ships and two Strategic Operating Vessels (SOVs).
While the value of the FSS will be around Rs.10,000 crore, the SOVs also called midget submarines will be worth Rs.3,000 crore. It is also receiving retrofit of naval submarine INS Sindhuvir after successfully handing over INS Sindhukirti to the Navy last year. The new submarine refit order is worth around Rs. 500 crore.
In an exclusive interview, HSL Chairman and Managing Director Rear Admiral (retired.) L.V. Sarat Babu told on Monday that once they start work on the orders, they would be in a formidable position after the yard had made a turnaround this year posting a net profit of Rs.19 crore after a long time.
The HSL also signed an MoU with the Hyundai Heavy Industries Co. Ltd of Korea, world’s largest shipyard, for mutual cooperation. Now the process is on for an inter-governmental agreement.
Rear Admiral Sarat Babu said during the past one year, due to the creation of work culture and various initiatives to motivate the workforce and make them feel proud of being part of the premier shipbuilding yard, the company, an enterprise under the Ministry of Defence, had increased its value of production (turnover) from Rs. 220 crore to Rs. 585 crore.
Going by the projections, the annual earnings from ship repairs is expected to cross Rs. 150 crore. The HSL is also confident of crossing the net profit during 2016-17. He said due to cost-cutting measures, the amount spent on establishment had been pruned from 40 per cent to less than 20 per cent.
The HSL was set up in 1941 by the Scindia Steam Navigation Company in 1941. It became a partially government owned entity in 1952 and fully government controlled in 1961. It is the first shipbuilding yard to get ISO-9001 certification. It was brought under the Ministry of Defence from Shipping in 2010.