Bangalore: Hindustan Aeronautics Ltd, or HAL, is at the top of the government’s disinvestment list. In 2013, the government hopes to offload 10 per cent of its equity in the aviation company in an initial public offer (IPO). The move is a part of the government's larger plan to raise Rs 30,000 crore by selling its stake this financial year. The induction of non-government shareholders in the Bangalore-headquartered maker of aircraft, engines, components and accessories, if the IPO happens, will complete a circle of sorts. HAL traces its roots to a company called Hindustan Aircraft, which was set up in December 1940 by Seth Walchand Hirachand in association with the then princely state of Mysore. The government became a shareholder in 1941 and took over the management in 1942. In 1964, it was merged with Aeronautics India and Aircraft Manufacturing Depot , Kanpur, to form HAL.
HAL has a virtual monopoly in the sector. It is only now that large business houses ( Tata , Godrej , Mahindra and Larsen & Toubro, to name a few) have shown interest in defence. But, they are all too small when compared to HAL, though at least one of these business houses, Mahindra, is known to be very keen to build its aviation business. As a result, HAL’s financial performance has been strong and steady (see table). It reported a profit before tax of Rs 3,200 crore on sales of Rs 14,001 crore in 2011-12. Its net profit margin has been upwards of 17-18 per cent. Its capital assets have risen from Rs 8,143 crore in 2008-09 to Rs 9,628 crore in 2009-10 and then to Rs 11,230 crore in 2010-11. HAL has huge land parcels in places like Bangalore, Nashik, Koraput (Odisha), Hyderabad, Lucknow and Kanpur.
22/11/12 Praveen Bose/Business Standard
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HAL has a virtual monopoly in the sector. It is only now that large business houses ( Tata , Godrej , Mahindra and Larsen & Toubro, to name a few) have shown interest in defence. But, they are all too small when compared to HAL, though at least one of these business houses, Mahindra, is known to be very keen to build its aviation business. As a result, HAL’s financial performance has been strong and steady (see table). It reported a profit before tax of Rs 3,200 crore on sales of Rs 14,001 crore in 2011-12. Its net profit margin has been upwards of 17-18 per cent. Its capital assets have risen from Rs 8,143 crore in 2008-09 to Rs 9,628 crore in 2009-10 and then to Rs 11,230 crore in 2010-11. HAL has huge land parcels in places like Bangalore, Nashik, Koraput (Odisha), Hyderabad, Lucknow and Kanpur.
22/11/12 Praveen Bose/Business Standard
