Hindustan Aeronautics Ltd
Chairman Speech
Dear Shareholders,
It gives me immense pleasure to welcome you all for the 60th Annual
General Meeting of Hindustan Aeronautics Limited.
I take this opportunity to share the performance highlights during the year and future
outlook for the Company.
Financial and Performance Highlights of the Year
In the financial year 2022-23, your Company recorded the highest ever turnover of `
26,36,056 Lakh, experiencing strong growth of 8% from the previous year's ` 24,36,166
Lakh. The Profit Before Tax (PBT) saw a growth of 24% from 5,23,115 Lakh to ` 6,49,294
Lakh while the Profit After Tax (PAT) increased by 14% from ` 5,08,650 Lakh to ` 5,81,117
Lakh. Our Order Book position stood healthy at ` 81,78,400 Lakh as on 31st
March, 2023.
The Company has paid 1st & 2nd interim Dividend each of
` 20 per share of face value of `10 each for the Financial Year 2022-23, totalling to
`1,33,755 Lakh. Further, the Board of Directors of the Company has recommended a final
dividend of ` 15 per share of `10 each for approval of shareholders, with a cash outflow
of ` 50,158 Lakh. On approval by the shareholders, the total cash outflow for payment of
Dividend for the Financial Year 2022-23 would be ` 1,83,913 Lakh.
During the year, the Company has produced 22 numbers of new Aircraft and Helicopters,
covering LCA Tejas, Dornier Do-228, ALH Dhruv, Light Combat Helicopter (LCH) and
Light Utility Helicopter (LUH) in addition to the production of 51 New Engines and
Accessories, at its various Divisions. The Company has also overhauled 216 Aircraft /
Helicopters and 536 engines during the year.
Your Company has put in concerted effort on indigenisation of components, accessories
and systems required to manufacture as well as repair & overhaul of aircraft, engine
and associated accessories. Every year, the Company indigenizes various items/ components
and systems of foreign origin fitted on HAL platforms through in-house capabilities or
with the help of local vendors to reduce dependence on imports, savings in foreign
exchange and manage obsolescence, thus fostering self-reliance through ‘Make in
India'.
During the year, in line with the Atmanirbhar Bharat Abhiyan of Govt. of India, the
Company has placed orders worth ` 5,977 Lakh for indigenous development of 26 Line
Replaceable Units (LRUs) under Make-I and Project Sanction Orders for additional 36 LRUs
under Make II.
Significant Achievements
Your Company has witnessed several significant achievements during the year, some of
which are highlighted as under:
Hon'ble President of India, inaugurated HAL's state-of-the-art Integrated Cryogenic
Engine Manufacturing Facility (ICMF) in Bengaluru on 27th September, 2022. The
facility not only cater to the entire Rocket Engine Manufacturing under one roof for ISRO
but also boost self-reliance in manufacturing of Hi-thrust Rocket engines.
Hon'ble Prime Minister, Shri Narendra Modi unveiled HTT-
40 the indigenous trainer aircraft designed and developed by HAL at the India Pavilion
during DEFEXPO-2022 at Gandhinagar, Gujarat on 19th October, 2022.
Hon'ble Prime Minister dedicated HAL's New Helicopter
Factory in Tumakuru to the nation on 6th February, 2023. During the event,
Hon'ble Prime Minister unveiled HAL's indigenously designed and developed Light Utility
Helicopter (LUH).
Hon'ble Raksha Mantri inducted Prachand - Light Combat
Helicopters (LCH) in IAF on 3rd October, 2022.
Successfully completed the production of 15 Light Combat
Helicopters (LCH) ahead of contract schedule.
The first flight of the LCA Mk1A prototype (LCA SP-25 modified for MK1A features) was
conducted on 20th May, 2022, which is a major milestone towards LCA MK1A
program.
Delivered the first set of hardware for Gaganyaan mission
(first unmanned mission) as well as the 150th HAL made Satellite
Bus-structure to ISRO on 4th April, 2022.
Mission Management System (MMS) for DO-228 aircraft was Indigenously Designed and
Developed and 4 aircraft were upgraded and delivered to Indian Coast Guard (ICG).
Solid State Flight Data Recorder (SSFDR) / Cockpit
Voice Recorder (CVR) for Cheetah, Chetak and Cheetal helicopter was designed and
developed. ‘Type Approval' for this system has been accorded by CEMILAC. The
‘Flight Clearance' for deployable Flight Data Recorder (FDR) and Interface Computer
for DO-228 aircraft was also accorded by RCMA (Korwa).
New Initiatives
During the year, your Company has taken many new initiatives, which includes Design and
Development of LUH Civil, Hindustan Lead in Fighter Trainer (HLFT-42), ALH WSI Phase-II
program, Level D Full Flight Simulator for Hindustan-228, Full Mission Simulator for LUH,
Indigenisation of Integrated Architecture & Display System (IADS) and Automatic Flight
Control System
(AFCS) of ALH. HAL also received a Development cum Production Partner (DcPP)/
Production Agency (PA) certificate for ABHYAS - High Speed Expendable Aerial Target (HEAT)
System from DRDO. Further, following significant MOUs have been signed by HAL:
With Safran Helicopter Engines to create a new joint venture intended for design,
development, production, sales and support of helicopter engines to meet not only the
requirements of future helicopters programmes of Indian Defence including the 13-ton IMRH
(Indian Multi-Role Helicopter), but also for the Global market.
With Air Mauritius Limited for undertaking a feasibility study for enhancing /
setting-up MRO facility by Air Mauritius towards maintenance and other associated works on
HAL supplied Do-228 aircraft to Mauritius Air Squadron as well as other countries in the
region.
With Rolls Royce in July, 2022 to explore the potential opportunity of HAL to become in
Country partner supplier for MT7 Marine Gas Turbine Package for sales within the Indian
Market.
With Heroux Devtek at Farnborough Airshow on 19th July ,
2022, for design, development, manufacture, repair and overhaul of Landing gears of
C-295 aircraft.
With Honeywell International Inc. at Farnborough Airshow in July 2022 for ‘High
Power Generation Equipment , collaboration'.
With Israel Aerospace Industries (IAI) Limited for leasing, operation and maintenance
of fixed wing UAVs to the Indian Defence Forces.
Future Outlook
Indian Defence Sector which was so far contributing as strategic sector is gradually
developing as an economic sector which is capable to contribute to the economic growth of
the country. Under the Atmanirbhar Bharat initiative, Government is facilitating the
development of the Indian industry to reduce the defence import as well as dependence on
the foreign OEMs. Various initiatives of the GoI in recent days have given thrust on the
indigenization and indigenous procurement of defence equipment. Over next 5 -10 years such
reforms will equally help Defence PSUs and private industry to put a firm step towards
achieving a self-sustaining Defence industry in the country.
As continuous efforts towards achieving self-reliance "Atmanirbharta" in the
Aerospace & Defence industry in India, HAL will remain involved in supporting Startup
Companies, SMEs/ MSMEs, Tier – II and III vendors. HAL will also keep handholding the
vendors and suppliers in R&D, capability development and extended employment
generation.
In near future, Indian Defence market will continue to be prime revenue source for HAL
due to projects like LCA Mk1A, LCH, LUH and HTT-40. The company has taken various
initiatives to make systems more agile, effective, cost efficient and to be competitive.
Enhancement of HAL capability is being planned to cater above projects. New production
line are being installed for HTT-40 and LCA Mk1A Production.
In medium term, we are also looking forward to diversify and increase our presence in
UAV, Civil MRO & allied operations, Digital Solutions and new space segments as
strategic initiatives. Also, we are focusing on strengthening marketing efforts, expanding
geographical presence and collaboration with Indian Industry / Global OEMs to boost export
sales.
Research and Development (R&D)
Your Company has continued its efforts towards the Design and Development of new
platforms/ products / technologies and activities to enhance its capability with a view to
bring technological superiority to its products and to cope up with the future
technological challenges. These efforts have resulted in major achievements such as
successful first _ight of ALH with two segmented Main Rotor Blades and Pre-Cone Main Rotor
Head developed to address the stringent stowage dimension requirement of Indian Navy,
first Inverted Spin tests of HTT-40, first _ight of LCA Mk1A and maiden arrested
landing & ski-jump take-off by LCA Navy MK1 aircraft from the indigenous
aircraft carrier INS Vikrant.
The futuristic projects such as LCA Mk II, Advance Medium Combat Aircraft (AMCA),
Indian Multirole Helicopter (IMRH), Twin Engine Deck Based Fighter (TEDBF), Combat Air
Teaming System (CATS) etc. will ensure technological lead of HAL in the years to come, due
to significant design & development activities. This will provide good visibility for
future platform orders.
During the year, the Company has incurred a total R&D expenditure of `2,49,433
Lakh, which is 9.46% of the Turnover. The Company has transferred a sum of `53,881 Lakh
(15% of Operating PAT) to R&D corpus during the year 2022-23.
Corporate Governance
Your Company always strives to conduct the business with integrity, and in ethical
& transparent manner and attain the highest standard of Corporate Governance practice.
The Company has complied with the Guidelines on Corporate Governance framed by the
Department of Public Enterprises (DPE) and SEBI Listing Regulations except for the
appointment of the requisite number of Independent Directors. The Company has established
Systems and Procedures to ensure that its Board of Directors is well informed about the
Policies of the Company, to enable them to discharge their responsibilities and to enhance
the overall value of all stakeholders. We are periodically reviewing the Policies and
Procedures of the Company and updating them to ensure transparency in all aspects of the
Company's working. Your Company has been continuously rated ‘Excellent' grade for its
compliances with DPE Guidelines on Corporate Governance.
Corporate Social Responsibility and Sustainability Development
Your Company is committed to its social responsibility. In this endeavour, the Company
has undertaken various CSR programmes and projects, towards integrating our social and
business goals in a sustainable manner in line with schedule VII of the Companies Act,
2013. An amount of ` 10,328 Lakh has been spent under CSR in the Financial Year 2022-23
against the CSR budget/ obligation of `9,707 Lakh.
Acknowledgement
Your Company will continue to pursue global standards, and I am confident that the
Company will achieve many milestones. We hope to attain all round success with the
continued support and guidance of all our stakeholders.
I take this opportunity to extend my sincere gratitude to the Department of Defence
Production, Defence Acquisition Council, Defence Finance, Department of Civil Aviation and
our valuable customers viz., the Indian Air Force, Indian Army, Indian Navy, Indian Coast
Guard, Border Security Force, ISRO and other Global Aviation Companies.
I also thank DGAQA, CEMILAC, Principal Controller of Defence Accounts, Principal
Director of Commercial Audit, C&AG, Auditors, Bankers, Legal Advisors, Collaborators,
Suppliers, Shareholders and other Agencies and acknowledge their contributions in our
achievements.
I am grateful to the members on the Board for their valuable guidance and acknowledge
the immense contribution and dedication of the employees of the Company at all levels.
|
C.B. Ananthakrishnan |
|
Director (Finance) & CFO |
| Place : Bengaluru |
Chairman and Managing Director |
| Date : July 19, 2023 |
(Additional Charge) |
Hindustan Aeronautics Ltd
Directors Reports
Dear Members,
Your Board of Directors takes great pleasure in presenting their Report on the
performance of the Company ("the Company" or "HAL"), and its Audited
Financial Statements for the Financial Year ended March 31, 2023, together with Reports of
the Statutory Auditors and the Comptroller & Auditor General of India (C&AG)
thereon.
FINANCIAL HIGHLIGHTS
The financial highlights for the year ended March 31, 2023 are summarised as under:
|
( ` in Lakh except per equity share data) |
PARTICULARS |
2022-23 |
2021-22 |
| Turnover |
26,36,056 |
24,36,166 |
| Exports |
29,371 |
16,796 |
| Profit Before Tax (PBT) |
6,49,294 |
5,23,115 |
| Provision for Tax |
68,177 |
14,465 |
| Profit After Tax (PAT) |
5,81,117 |
5,08,650 |
| R&D Expenditure |
2,49,433 |
1,96,691 |
| Earnings/ Share (in `) |
173.79 |
152.11 |
| Book Value / Share (in `) |
702.96 |
576.10 |
During the year under review, the turnover of the Company increased by 8% to `26,36,056
Lakh from `24,36,166 Lakh of the previous year. The Profit before Tax for the year
increased by 24% to `6,49,294 Lakh from `5,23,115 Lakh in the previous year. The Profit
after Tax (PAT) increased by 14% to `5,81,117 Lakh from `5,08,650 Lakh in the previous
year.
PRODUCTION HIGHLIGHTS
During the year, the Company has produced 22 numbers of new Aircraft and Helicopters,
covering LCA Tejas, Dornier Do-228, ALH Dhruv, Light Combat Helicopter (LCH) and Light
Utility Helicopter (LUH) in addition to the production of 51 New Engines and Accessories,
at its various Divisions. The Company has also overhauled 216 Aircraft / Helicopters and
535 engines during the year.
ORDER BOOK POSITION
During the year, the Company has bagged contracts for production and supply of 70 Nos.
of HTT-40 Basic Trainer Aircraft on March 6, 2023 and 6 Nos. of Dornier 228 Aircraft on
March 10, 2023.
The Order Book position of the Company stands at ` 81,78,400 Lakh as on March 31, 2023.
DIVIDEND
During the year, your Company has declared and paid 1st interim
dividend of `20 per share of `10 each (200 %) for the financial year 2022-23, amounting to
` 66,877.50 Lakh.
Further, the Company has also declared and paid 2nd interim dividend of ` 20
per share of `10 each (200 %) for the financial year 2022-23, amounting to ` 66,877.50
Lakh.
The Board of Directors of the Company has recommended a final dividend of `15/- per
share of ` 10 each to comply with the Guidelines of Department of Investment and Public
Asset Management (DIPAM) on Capital restructuring with respect to payment of minimum
dividend. The Final Dividend if approved by the shareholders, would involve cash outflow
of `50,158 Lakhs.
Thus, the total dividend including final dividend for the financial year 2022-23 would
be `55/-per equity share (550%), amounting to `1,83,913 Lakhs.
In terms of the provisions of Regulation 43A of the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 [SEBI (LODR) Regulations] and the Guidelines of
DIPAM, your Company has formulated a Dividend Distribution Policy and the same is
available on the Company's website at https://hal-india.
co.in/Common/Uploads/DMS/Dividend_Distribution_Policy.pdf
CAPEX
In order to maintain the state of the art infrastructure and technologies to meet
Aerospace Standard and also to develop systems/platforms for meeting the requirements of
the Defence Forces and to become Atmanirbhar Bharat, HAL has incurred Capital Expenditure
(CAPEX) of `2,08,173 Lakhs in FY 2022-23 ( PY `1,62,174 Lakhs). The investments are mainly
towards Green Field Helicopter project at Tumakuru, augmentation of facilities of LCA, ROH
of SU-30, ROH of AL-31 FP Engine etc. besides the regular replacement and rationalisation
of the existing facilities.
OFFER FOR SALE (OFS)
To achieve the mandatory threshold of 25% minimum public shareholding in the
Company,_Government of India (GoI) had offered 3.5% (1,17,03,563) equity shares of the
Company to non-Retail Investors and Retail Investors on March 23-24, 2023, out of its
shareholding of 75.15% in the Company, through Offer for Sale (OFS) by Stock Exchange
Mechanism. Consequent to the OFS, the GoI shareholding as on March 31, 2023 stands at
71.65%.
Apartfromabove,aspartoftheOFS,GoIhadalso_allotted_37,632 equity shares to the eligible
employees of the Company during April, 2023 under Employee OFS. Consequent to the Employee
OFS, the GoI shareholding stands at 71.64%.
RESERVES
During the year under review, `53,881 Lakh was transferred to Research &
Development Reserve, `10,776 Lakh was transferred to Indigenization Fund Reserve and
` 3,59,576 Lakh to General Reserve.
BORROWINGS
As on March 31, 2023, the short term and long term borrowings of the Company was Nil.
INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY
The Company has an Internal Control System, commensurate with the size, scale and
complexity of its operations. The Company has in place adequate internal financial
controls for ensuring efficient conduct of its business. A detailed note on internal
financial controls is provided in the Management Discussion and Analysis Report.
LOANS, GUARANTEES AND INVESTMENTS
Details of Loans, Guarantees and Investments as covered under the provisions of Section
186 of the Companies Act, 2013 (‘'the Act") form part of Notes to the Financial
Statements.
RELATED PARTY TRANSACTIONS
During the year, your Company has entered into transactions with related parties. In
line with Related Party Transactions (RPTs) Policy, approval of the Audit Committee and
Board, as the case may be was obtained for RPTs. As per the threshold mentioned in the
Policy, there were no material related party transactions with the Company's Promoters,
Directors, Management or their relatives, which could have had a potential conflict with
the interests of the Company. The disclosures related to RPTs in accordance with the
applicable accounting standards are provided in Clause No. 45A of the Notes to the
financial statements. Details of contract(s) or arrangement(s) with related parties
referred to in Section 188(1) of the Companies Act read with Rule 8(2) of the Companies
(Accounts) Rules, 2014, in the prescribed form AOC-2, is attached to this Report as Annexure-I.
CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements of your Company and its Joint Venture Companies
& Subsidiary Companies for the year ended March 31, 2023 have been prepared in
accordance with the provisions of Section 129(3) of the Companies Act and applicable
Accounting Standards, and form part of this report.
Pursuant to the first proviso of Section 129(3) of the Companies Act read with Rule 5
of the Companies (Accounts) Rules, 2014, a separate statement containing salient features
of the Financial Statements of Subsidiaries / Associate / Joint Venture Companies in Form
AOC-1 is appended to this report, which forms part of the Financial Statements. The
separate Audited Financial Statements in respect of the Subsidiaries are also available on
the website of the Company at www.hal-india.co.in.
SUBSIDIARY/ ASSOCIATE/ JOINT VENTURE COMPANIES
As on March 31, 2023, your Company has two Subsidiaries including one wholly owned
Subsidiary and thirteen Joint Venture Companies (JVCs) including two Not-for-Profit
Companies (Section 8 Companies).
Pursuant to the provisions of Section 134(3)(q) of the Companies Act read with Rule
8(1) of the Companies (Accounts) Rules, 2014, a Report on the performance and financial
position of each of the Joint Venture Companies and Subsidiary Companies is attached to
this Report as Annexure-II.
SIGNIFICANT ACHIEVEMENTS
Significant achievements of the Company during the year are as follows:
The state-of-the-art Integrated Cryogenic Engine
Manufacturing Facility (ICMF) of the Company was inaugurated by Hon'ble President of
India, in Bengaluru on September 27, 2022. The facility will cater to the entire Rocket
Engine Manufacturing under one roof for ISRO, it will also boost self-reliance in
manufacturing of Hi-thrust Rocket engines.
HAL's New Helicopter Factory in Tumakuru was dedicated to the nation by Hon'ble Prime
Minister of India on February 6, 2023.
Successfully completed the production of 15 Light Combat
Helicopters (LCH) against the 15 LCH contract ahead of contract schedule.
Handed over the last of the 16 ALH MKIII (Maritime role) order to the Indian Coast
Guard (ICG) on November 15, 2022. During the event, a Letter of Intent (LoI) for nine more
helicopters was received from ICG.
The first flight of the LCA Mk1A prototype (LCA SP-25 modified for MK1A features) was
conducted on May 20, 2022, which is the major milestone towards LCA MK1A program.
Successfully produced 4 Do-228 aircraft in advance against the contract for supply 6
Do-228 to IAF.
The maiden arrested landing and ski-jump take-off from the indigenous aircraft carrier
INS Vikrant was carried out by the LCA Navy MK1 aircraft on February 6, 2023.
Delivered the first set of hardware for Gaganyaan mission
(first unmanned mission) as well as the 150th HAL made Satellite
Bus-structure to ISRO on April 4, 2022. HAL also delivered the Crew Module Fairing (CMF)
and HEM-Thrust Transfer Structure (HTS) hardware for ‘Human Space_ight Program' to
Indian Space Research Organization (ISRO) on August 17, 2022 in Bengaluru.
Build of LCA Navy MK I Trainer prototype aircraft NP5
(3rd Naval prototype) completed and engine ground run carried out on January
16, 2023.
Design & development of Indigenous Mission Management
System (MMS) integrated on DO-228 (ICG) and _ight testing commenced from August 25,
2022.
Solid State Flight Data Recorder (SSFDR) / Cockpit
Voice Recorder (CVR) for Cheetah, Chetak and Cheetal helicopter has designed and
developed. ‘Type Approval' for this system has been accorded by CEMILAC. The
‘Flight Clearance' for deployable Flight Data Recorder (FDR) and Interface Computer
for DO-228 aircraft as also accorded by RCMA (Korwa).
CURRENT PROJECTS AND PROGRAMS
During the year, the Company has produced Light Combat Aircraft (LCA) Tejas, Dornier
Do-228 Aircraft, Advanced Light Helicopter (ALH) Dhruv, Light Combat Helicopter (LCH),
Light Utility Helicopter (LUH), engines, accessories and aerospace structures against the
various customer orders. To boost the Atmanirbharta in defence, the Company has
indigenously designed and developed two products namely HTT-40 Basic Trainer Aircraft and
LUH MkI. The Company has received contract for supply of 70 HTT-40 aircraft in March,
2023.
During the year, the Company has commenced manufacturing of helicopter at New
Helicopter Factory, Tumakuru. The Company has also established facilities for
manufacturing of semi cryogenic and cryogenic engine components at Integrated Cryogenic
Engine Manufacturing Facility (ICMF). The facility will cater to the entire Rocket Engine
Manufacturing under one roof for ISRO, it will also boost self-reliance in manufacturing
of Hi-thrust Rocket engines.
The Company has achieved a significant milestone towards civil aviation segment and
Regional Connectivity Scheme UDAN with the first commercial _ight of HAL's civil Do-228
held on April 12, 2022 at Dibrugarh-Pasighat route. The Company has progressed on bringing
improvements in civil Do-228 / Hindustan 228-201 aircraft and attained Type Certification
with latest FAR 23 certification requirement from DGCA. Further, Hindustan 228-201LW with
Maximum Take Off Weight of 5695 Kgs has also been approved by DGCA in January,
2023. With this modification, the aircraft would fall in the Sub 5700 kg aircraft
category.
DESIGN AND DEVELOPMENT PROGRAMS
The Company continued to boost the "Atmanirbhar Bharat Abhiyan" of Govt. of
India with its focused efforts towards design and development of products, technologies
and capabilities to meet the future requirements of Indian defence forces and non-military
aerospace market in India. The Company has considerably progressed towards the realization
of our indigenous programmes viz. Basic Trainer Aircraft (HTT-40), Light Utility
Helicopter (LUH), Light Combat Aircraft
(LCA)- MK1A, Indian Multi-Role Helicopter (IMRH) and
Development of Engines. The progress achieved in respect of these projects during the
year is given below:
BASIC TRAINER AIRCRAFT (HTT-40)
HTT – 40 is the Basic Trainer aircraft currently being indigenously designed and
developed by HAL. HTT-40 would be used for basic _ight training, aerobatics, instrument
_ying and close-formation _ights whereas its secondary roles would include navigation and
night _ying. Features of the aircraft include Air conditioned cockpit, Tandem seating,
Zero-Zero ejection seats and Multifunction Displays. The program was taken up with
internal funding. A total of 3 prototypes have been built which includes two _ying
prototype and one Structural Test Specimen (STS).
During the year, HTT-40 successfully completed erect spin certification _ights, and
PSQR validation trials. All systems certified to PSQR and FAR 23. Airworthiness
certificate for Aircraft obtained. First Inverted Spin tests was carried out in March,
2023. HAL has bagged the contract for supply of 70 HTT-40 aircraft on March 6, 2023.
LIGHT COMBAT AIRCRAFT (LCA) Mk 1A
LCA Mk1A is an improved variant of indigenously developed
LCA MK1, presently being developed by HAL. It has additional features and improvements
such as Self Protection Jammer, Active Electronically Scanned Array (AESA) RADAR, Beyond
Visual Range (BVR) Missile and maintainability improvements etc.
LCA Mk1A development activities are under progress. Aircraft modification completed
with integration of AESA Radar, EW Suite, and upgraded Open Architecture Computer (OAC)
software. Flight testing commenced on May 20, 2022.
LIGHT UTILITY HELICOPTER (LUH)
The LUH is a single engine, 3 Ton weight class helicopter having Glass Cockpit with
Multi-Function Displays. The LUH is intended to meet different role requirements including
high altitude operation which is specific requirement of our Defence Services. Three _ying
prototypes have been built and were extensively _ight tested. Initial Operational
Clearance (IOC) for LUH IAF Version was accorded on February 7, 2020 and for the Indian
Army Version on February 5, 2021.
Integration of Automatic Flight Control System (AFCS) is progressing and will be
completed by December, 2023. HAL has produced first LUH Mk-I in July, 2022 against the
Letter of Intent (LoI) for 12 helicopters.
INDIAN MULTI ROLE HELICOPTER (IMRH)
The Company has under taken the design and development of 10-15 ton class IMRH for
Indian Air Force, Indian Army and Indian Navy. The Naval variant of IMRH is christened
Deck Based Multi Role Helicopter (DBMRH).
IMRH and DBMRH would be designed to meet the requirement of all the three military
services and its future extension to civil market to cater to off shore operations,
utility, VVIP transport etc., to enlarge the helicopter business through production as
well as MRO activities.
Currently, the preliminary design activities are under progress. HAL has completed
Phase 1 of wind tunnel testing of IMRH-IAF scaled model and results are satisfactory.
Phase-2 of Wind Tunnel testing are under progress.
25 kN TURBOFAN ENGINE (HTFE-25)
Design and development of a 25kN thrust class turbofan engine, which can be used on
Basic/ Advanced military trainers, on small business jets and also large UAV applications
is under progress at HAL. The engine can be used on a 5-ton weight class aircraft in
single engine con_guration and on aircraft of up to nine- ton weight class with
twin-engine con_guration. Two core engines have been produced so far and are undergoing
development trials.
1200 kW TURBOSHAFT ENGINE (HTSE-1200)
The 1200KW Turbo shaft engine would be used as power plant for 3 to 6-ton category
helicopters. One technology demonstrator of HTSE-1200 engine was built and is presently
under testing.
HAWK-i
Hawk-i is the indigenously upgraded Hawk Mk 132 aircraft with enhanced operational and
training capabilities. Hawk-i is now equipped with new suite of Avionics like improved
Radio Altimeter (RADALT), Identification of Friend & Foe (IFF Mk XII), Solid State
Digital Video Recording System (SSDVRS), Counter Measure Dispensing System (CMDS), Softnet
Radio, Integrated Communication System (INCOM), Data Transfer System (DTS), Smart
Anti-Airfield Weapon (SAAW), Radar Warning Receiver (RWR), Voice Activated Command System
(VACS), Integrated Control Unit (ICU) & Head Up Display (HUD) .
RESEARCH AND DEVELOPMENT EFFORTS
During the year, indigenously designed and developed HTT-40 Basic Trainer Aircraft and
LUH were unveiled by Hon'ble Prime Minister.
The R&D efforts of the Company have resulted in successful first _ight of ALH with
two segmented Main Rotor Blades and Pre-Cone Main Rotor Head developed to address the
stringent stowage dimension requirement of Indian Navy, first Inverted Spin tests of
HTT-40, first _ight of LCA Mk1A and maiden arrested landing & ski-jump take-off by LCA
Navy MK1 aircraft out from the indigenous aircraft carrier INS Vikrant.
The Company is also undertaking the development of aero engine, starter engines,
avionics and accessories. Towards this, a major achievement of the Company is development
of the gas turbine starter engine GTSU-127E for ADA and successful built of a Technology
Demonstrator (TD) unit. The TD unit was tested for light-up, acceleration and initial
performance and the results are as anticipated in the design stage.
During the year, the Company has incurred a total R&D expenditure of`2,49,433 Lakh,
which is 9.46% of the Turnover. The Company has transferred a sum of `53,881 Lakh (15% of
Operating PAT) to R&D reserve for contribution to R&D corpus during the year
2022-23.
During the year, HAL has filed 192 IPR applications which make cumulative number of
2224 IPRs filed by company. Further, 116 IPRs have also been granted during the year
taking cumulative IPRs held by the organization to 748. (Patents – 154, Industrial
Designs – 115, Copyrights – 477, Trademark - 2).
BOARD AND ITS COMMITTEE MEETINGS
During the year, 12 (Twelve) Board Meetings were held and the maximum interval between
any two meetings was not more than 120 days.
The details of meetings of the Board and Committees thereof held during the year are
furnished in the Corporate Governance Report, which forms part of this Report.
COMMITTEES OF THE BOARD
As on March 31, 2023, the Board has five Statutory Committees namely Audit Committee,
Nomination & Remuneration Committee, Corporate Social Responsibility & Sustainable
Development Committee, Stakeholders Relationship Committee and Risk Management Committee.
A detailed note on the composition, terms of reference and meetings of the Board and
its Committees is provided in the Corporate Governance Report.
CHANGES IN BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
The following changes took place in the Board of Directors and
Key Managerial Personnel (KMP) of your Company during the
financial year:
Appointment
Shri Deepak Abasaheb Shinde appointed as Part Time
Non-Official (Independent Director) on the Board of the Company w.e.f April 28, 2022.
Shri Jayadeva E P appointed as Director (Operations) on the Board of the Company w.e.f
June 10, 2022.
Shri Rajeev Prakash appointed as Govt. Nominee Director on the Board of the Company
w.e.f September 14, 2022.
Dr D K Sunil appointed as Director (Engg and R&D) on the
Board of the Company w.e.f September 29, 2022.
Shri T Natarajan appointed as Govt. Nominee Director on the Board of the Company w.e.f
December 23, 2022.
Shri Shailesh Bansal appointed as Company Secretary of the Company w.e.f. March 28,
2023.
Cessation
Shri Arup Chattterjee ceased as Director (Engg and R & D) on the Board of the
Company due to his superannuation on June 30, 2022.
Shri R Madhavan ceased as Chairman and Managing
Director on the Board of the Company due to his superannuation on July 31, 2022.
Shri Alok Verma ceased as Director (HR) on the Board of the Company due to his
superannuation on November 30, 2022.
Shri Chandraker Bharti ceased as Govt. Nominee Director on the Board of the Company due
to withdrawal of Nomination w.e.f September 14, 2022.
Shri Rajeev Prakash ceased as Govt. Nominee Director on the Board of the Company due to
withdrawal of Nomination w.e.f December 23, 2022.
Shri G V Sesha Reddy, ceased as Company Secretary of the Company due to his
superannuation on October 31, 2022.
DECLARATION OF INDEPENDENCE
Declarations from the Independent Directors of the Company have been received,
confirming that they met the criteria of independence as prescribed under Section 149(6)
of the Companies Act, 2013 and Regulation 25(8) of the SEBI (LODR) Regulations.
COMPANYS POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION
The appointment, tenure and remuneration of Functional Directors including Chairman and
Managing Director (CMD) are determined by the Government of India. The Terms
& Conditions of appointment, including the period of appointment, the Scale of Pay
and other entitlements are notified by the Government of India.
Government Nominee Directors are appointed by the Department of Defence Production,
Ministry of Defence and they are not entitled to any remuneration / sitting fees.
Independent Directors are appointed by the Government of India and they are entitled to
sitting fees for attending the Board / Committee meetings as prescribed by the Board in
line with the Companies Act and Rules made thereunder.
In view of the Gazette Notification No GSR 463 (E) dated June 5, 2015 of the Ministry
of Corporate Affairs (MCA), your Company, being a Government Company, is not required to
frame a Policy on Directors' appointment and remuneration, including criteria for
determining qualifications etc. under Section 134(3)(e) of the Companies Act.
BOARD EVALUATION
Pursuant to the Notification No. 463 (E) dated June 5, 2015 issued by the Ministry of
Corporate Affairs, the statement indicating the manner in which formal annual evaluation
has been made by the Board of its own performance and that of its Committees and
individual directors is not required for your Company, as the performance of directors is
evaluated by the Administrative Ministry. The performance evaluation of Independent
Directors was carried out by the entire Board.
ANNUAL RETURN
In accordance with the provisions of the Companies Act, 2013, the Annual Return in the
prescribed format has been hosted on website of the Company at
https://hal-india.co.in/Common/ Uploads/DMS/Draft_MGT_7_2022_23.pdf
COMPLIANCE WITH SECRETARIAL STANDARDS
The Company complies with all applicable mandatory Secretarial Standards issued by the
Institute of Company Secretaries of India.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
As a defence Central Public Sector Enterprise (CPSE), your Company was granted
exemption vide Notification GSR No.680 (E) dated September 4, 2015, from the disclosure of
information with respect to conservation of energy, technology absorption, foreign
exchange earnings and outgo under the provisions of Section 134(3)(m) read with Rule 8(3)
of the Companies (Accounts) Rules, 2014.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
Pursuant to the provisions of Section 135 of the Companies Act and Companies (Corporate
Social Responsibility Policy) Rules, 2014 and Amendment thereof & DPE Guidelines, the
Company has undertaken various activities during the year as per its CSR Policy. The
projects / programmes / activities taken up are in line with Schedule VII of the Companies
Act. The thrust areas under CSR are Healthcare, Skill Development, Education, Enhancing
Employability through Training, etc. The other areas in which support extended were
Environment Sustainability, Sports Development, Rural Infrastructure Development,
Sanitation etc. The Company has spent an amount of `10,328 Lakhs under CSR for the
Financial Year 2022-23 against the CSR budget/ obligation of ` 9,707 Lakhs.
The Corporate Social Responsibility Policy, Composition of the Committee and CSR
Projects/ Activities of the Company is available on the Company's website at
https://hal-india. co.in/Corporate%20Social%20Responsibility/M__412. Salient features of
the Policy form part of the Annual Report.
Annual Report on CSR activities undertaken by your Company during the year 2022-23,
pursuant to Section 135 of the Companies Act, 2013 read with Companies (Corporate Social
Responsibility Policy) Rules, 2014, as amended, is attached to this Report as Annexure-III.
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
In terms of amendment dated May 05, 2021 to Regulation 34(2)(f) of SEBI (LODR)
Regulations, the Company has prepared Business Responsibility and Sustainability Report
(BRSR) for the year 2022-23 on Environment, Social and Governance (ESG) parameters in the
prescribed format and attached to this Report.
DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY
The Company has a Board approved Risk Management Policy, in place. The policy aims at
elimination or reduction of risk exposures through identification and analysis of various
types of risks and facilitating timely action for taking risk mitigation measures.
In line with Regulation 21 of the SEBI (LODR), Regulations, 2015, the Board of
Directors had constituted the Risk Management Committee for monitoring and reviewing of
the risk management plan and other such functions as it may, deem fit including ESG, Cyber
Security and Business Continuity Plan, in line with applicable laws.
SIGNIFICANT AND MATERIAL ORDERS
There are no significant and material orders passed by the Regulators or Courts or
Tribunals impacting the going concern status and the operation of the Company in future.
PUBLIC DEPOSITS
Your Company has not accepted any deposit during the year. Further, there was no
outstanding deposit and/or unpaid or unclaimed principal amount or interest against any
deposit either at the beginning or at the end of the Financial Year 2022-23.
ISSUE OF EQUITY SHARES WITH DIFFERENTIAL RIGHTS
During the year, the Company has not issued any equity shares with differential rights
as to dividend, voting or otherwise.
MATERIAL CHANGES SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS
No material changes / commitment of the Company have occurred after the end of the
Financial Year 2022-23 and till the date of this report, which affect the financial
position of the Company.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The provisions of Section 197 of the Companies Act and the relevant Rules regarding
particulars of employees drawing remuneration in excess of the limits specified are
exempted for Government Company, in view of the Gazette Notification No. G.S.R. 463 (E)
dated June 5, 2015 issued by the Ministry of Corporate Affairs, Government of India.
MOU WITH GOVERNMENT
Your Company is signing Memorandum of Understanding (MoU) every year with the Ministry
of Defence (MoD), Government of India (GoI).
The Company has achieved "Excellent" performance rating with a score of 92.83
for the financial year 2021-22 against MoU signed with the Ministry of Defence, Government
of India.
INDIGENISATION AND ATMANIRBHAR BHARAT
The Company has put in concerted effort on indigenisation of components, accessories
and systems required to manufacture as well as repair & overhaul of aircraft, engine
and associated accessories. Every year, HAL indigenizes various items/ components and
systems of foreign origin fitted on HAL platforms through in-house capabilities or with
the help of local vendors to reduce dependence on imports, savings in foreign exchange and
manage obsolescence, thus fostering self-reliance through ‘Make in India'.
In line with the Atmanirbhar Bharat Abhiyan of Govt. of India, HAL indigenised 1298 no.
of items which may lead to annual foreign exchange saving of ` 160.30 Crore during the FY
2022-23. To align with national priorities and ensure inclusive growth, HAL has been also
encouraging Indian private sector participation in the indigenization/ Make in India
efforts to undertake various high value systems/equipment of foreign origin fitted on HAL
platforms.
The other major initiatives / achievements during the year are as under:
Creation of a dedicated Indigenisation fund:
The Company has created a dedicated indigenization fund by transfer of 3% operating
profit after tax of the Company every year from the FY 2022-23. This fund will be used for
carrying out indigenization activities and will provide further impetus for
indigenization.
Identification of critical items for indigenization and inclusion in the Positive
Indigenisation Lists (PIL) issued by MoD:
In a major initiative, the Company has identified and made a comprehensive roadmap for
indigenization of complex aircraft Systems, LRUs & other critical Items across its
major platforms. These items are planned to be indigenized in the next 4-5 years in a
phased manner through participation of Indian Private Industries and Government Agencies
involving Academia. Such 430 imported items are included in the four PILs (PIL-1: 23,
PIL-2: 22, PIL-3: 360, PIL-4: 25) issued by DDP, MoD. Indigenisation of these items will
be a significant milestone towards Atmanirbharta in Defence Sector.
Indigenisation through Company Funds (similar to Make-I concept) :
Indigenization activity at HAL has, hitherto, been primarily driven by the need to
address the challenges posed by obsolescence of bought-out items pertaining to legacy
fleets and supply-chain constraints arising from various geo-political events. In certain
specific cases, indigenization was also taken up to counter the threat of exorbitant price
increase by foreign OEMs. HAL is utilizing internal funds to address all these challenges.
In the recent years, indigenization has been actively endorsed as a strategy to
increase self-reliance, in sync with the GoI policy of promoting ‘Atmanirbhar
Bharat'. Accordingly, some high value critical items are also being taken-up for
indigenization with internal funds.
In this procedure Development cost is being borne by HAL and supply orders are placed
on need basis.
Indigenisation through Make-II Procedure:
HAL 's Make-II programme is a step towards
‘Aatmanirbhar Bharat' & ‘Make in India' mission. HAL's Make-II (Industry
Funded) procedure is in compliance of the Make-II framework promulgated by MoD and
envisages the assured order quantity after successful development of items through private
vendors. HAL has identified items to be indigenized through Make-II procedure and uploaded
in the Srijan Defence Portal. EoIs of these items are being issued in phased manner to
take up for indigenisation under Make-II and so far, HAL has issued EoIs for around 900
items and Nil value Project Sanction order is placed for around 500 items for
indigenisation under Make-II.
Uploading of imported items in Srijan Defence Portal:
MoD has developed and launched Srijan (an indigenization portal) to support Indian
Industries with opportunities for Make in India in Defence. HAL has uploaded so far around
19000 nos. of imported items in the portal for information to private vendors and their
likely participation in the indigenisation programmes of HAL.
Organising / participation in Seminars, Conferences and Exhibitions on Indigenisation /
Vendor Development program
The Company has conducted / participated in more than 30 nos. of vendor development
programs / seminars / exhibitions at Divisional level during the current financial year to
sensitize Indian Vendors for opportunities available at HAL for indigenization and their
enhanced participation in indigenization programmes.
Details of testing facilities available at HAL which could be utilized by private
industries are hosted in HAL's website and can be accessed through www.hal-india.co.in.
OUTSOURCING
As part of the "Make in India" drive and the Atmanirbhar Bharat Abhiyan, HAL
has been nurturing & developing a vibrant indigenous aerospace & defence
ecosystem. In its path of moving towards being a lead integrator, HAL has been striving to
develop Tier-II and gradually Tier-I suppliers over a period of time while retaining the
core areas as prime integrators. HAL has been taking up outsourcing diligently even in the
new, up and coming projects, so as to turn the suppliers into reliable business partners
over time.
EXPORTS
Initiatives taken to boost Exports during the year are as under:
One passenger variant Do-228 (PVD) aircraft was handed over to Mauritius Police Force
within a record time of 6 themonths from the date of signing of the contract, well ahead
of the contractual delivery commitment.
Delivery of one ALH MKIII helicopter to Mauritius Police
Force ahead of contractual delivery schedule.
Imparting Phase-II _ying training on Chetak Helicopter for six officers of Nigerian
Army Aviation.
Signed contract between HAL and Argentine Air Force for Engine repair and Spares
support for 2 ton class helicopter.
BUSINESS DEVELOPMENT
The following Initiatives taken for Business Development during the year:
? Portal HAL Hindustan 228-201 aircraft attained Type Certification from DGCA. This
is the first Type Certified fixed wing aircraft complying with latest FAR 23 certification
requirement.
?Received approval for type training on Civil Do-228 aircraft from Civil Aviation
Authority of Nepal under NCAR147.
VENDOR DEVELOPMENT
During the year, the Company has taken several vendor development initiatives to
increase the number of vendors.
During the year, the Company has conducted 35 Vendor Development Programmes, out of
which, 6 were for Micro
& Small Enterprises (MSEs) owned by SC/ST Entrepreneurs & Woman Entrepreneurs.
The balance 29 were for across all categories. .
The Company has registered with RXIL, Mynd Solution and A TReDS Ltd. for enabling
payments through TReDS platform to MSMEs. All efforts are made to bring the MSMEs on TReDS
platform.
The Company has registered with MSME SAMBANDH portal and the procurement details are
being updated monthly in this Portal. The Company has also registered with MSME SAMADHAAN
portal and the same is being monitored regularly for resolution of payment complaints of
MSEs, if any.
Your Company is a part of Public Procurement Portal, Government e-Marketplace (GeM
portal) and registered as a Buyer in GeM Portal and taking up procurement of items which
are available in GeM Portal. Also procuring several items which are not available in GeM
Portal utilizing Custom Bid Module/ BoQ Module extensively. All our vendors are being
persuaded to on board on the GeM portal to utilize the facilities available in the GeM
portal.
HAL has implemented companywide e-Procurement system through its own e-Procurement
portal which is adopted for tenders issued outside GeM portal. A 24X7 e-Procurement help
desk has been established to provide information, support, training, operational
issues/clarifications to the vendors.
HAL has implemented the Public Procurement (Preference to Make in India), Order 2017
and its amendments thereof issued by Department for Promotion of Industry and Internal
Trade (DPIIT) to encourage ‘Make in India' and promote manufacturing and production
of goods & services in India.
PROCUREMENT FROM MICRO & SMALL ENTERPRISES (MSEs)
The Company has implemented the Public Procurement Policy for Micro and Small
Enterprises (MSEs) Order, 2012 & its amendments thereof issued by Ministry of MSME.
The Company has achieved more than the mandated procurement of 25% from MSE entrepreneurs
(excluding specific defence procurement as per Sl.No.14 of the policy). During the year,
the total value of procurement including\ outsourcing made from MSEs is ` 1,78,240 Lakh.
INTEGRITY PACT (IP)
Your Company has system of signing of IP with vendors for all procurement of Goods,
Services & Works / contracts having value of ` 5 Crore and above. Only those Vendors /
bidders, who commit themselves to IP with the HAL would be considered competent to
participate in the bidding process. Further, to encourage competition in HAL procurement
and to reduce processing lead time, HAL has implemented the Omnibus Integrity Pact with
effect from January 1, 2018. This Omnibus IP shall be valid upto 5 years and the same can
be proposed by bidder for consideration against any offers submitted by the vendor during
the validity period of Omnibus IP.
HUMAN RESOURCE DEVELOPMENT
The strength of employees as on March 31, 2023 stood at 24,457.
As on March 31, 2023, a total of 3618 Apprentices were engaged in the Company,
comprising 10.31 % of the total employee strength including contractual staff.
EMPLOYEE WELFARE
Company continues to extend welfare benefits to the employees and their dependants by
way of comprehensive Medical Facilities, Housing Facilities, Canteen Facilities (for
employees only), Educational facilities for employee's Children, Sports Facilities, etc.
Further, Company had taken Group Life Insurance Policy of ` 10 Lakhs on behalf of
employees and also introduced Financial Assistance Scheme to provide regular monthly
monetary support ranging from ` 15,000/- p.m. to ` 50,000/- p.m. depending upon the Grade
/ Scale of employee, to the dependents of deceased employees.
REPRESENTATION OF SC/STs
The position regarding representation of Scheduled Castes / Scheduled Tribes (SC / STs)
is as follows:
Representation of SC/STs in the total strength of the Company as on January 1, 2022 and
January 1, 2023
Category (Grade / Scale of Pay) |
Total Strength as on |
Number of SCs as on |
Number of STs as on |
|
1.1.2022 |
1.1.2023 |
1.1.2022 |
1.1.2023 |
1.1.2022 |
1.1.2023 |
Group – A (Grade – II & above ) |
7,843 |
7,602 |
1,396 |
1,369 |
482 |
473 |
Group – B (Grade-I) |
19 |
13 |
2 |
2 |
2 |
1 |
Group – C (Scale -3 to Special Scale) |
17,801 |
17,035 |
3,114 |
3,022 |
1,364 |
1,326 |
Group – D (Scales – 1 & 2 ) |
|
|
|
|
|
|
| (i) Excluding Safai Karmacharis |
5 |
4 |
1 |
1 |
- |
- |
| (ii) Safai Karmacharis |
- |
- |
- |
- |
- |
- |
Total |
25,668 |
24,654 |
4,513 |
4,394 |
1,848 |
1,800 |
Recruitments made during the period January 1, 2022 to December 31, 2022
and the SC/STs amongst them
Category (Grade / Scale of Pay) |
Total number of |
No. of Reservations made for |
No. of Posts filled by appointment of |
|
Post filled |
SCs |
STs |
SCs |
STs |
Group – A (Grade – II & above ) |
92 |
13 |
7 |
15 |
7 |
Group – B (Grade-I) |
- |
- |
- |
- |
- |
Group - C (Scale - 3 to Special Scale) |
8 |
1 |
- |
4 |
- |
Group - D (Scales – 1 & 2) |
|
|
|
|
|
| (i) Excluding Safai Karmacharis |
- |
- |
- |
- |
- |
| (ii) Safai Karmacharis |
- |
- |
- |
- |
- |
Total |
100 |
14 |
7 |
19 |
7 |
Vacancy - based Promotions made during the period January
1, 2022 to December 31, 2022 and the SC/STs amongst them |
|
Category (Grade / Scale of Pay) |
Total number |
No. of Reservations made for |
No. of Posts filled by Promotion of |
|
Promoted |
SCs |
STs |
SCs |
STs |
Group – A (Grade – II & above ) |
1176 |
NA |
NA |
198 |
75 |
Group – B (Grade-I) |
- |
- |
- |
- |
- |
Group – C (Scale - 3 to Special Scale) |
- |
- |
- |
- |
- |
Group – D (Scales – 1 & 2 ) |
|
|
|
|
|
(i) (i) Excluding Safai Karmacharis |
- |
- |
- |
- |
- |
(ii) Safai Karmacharis |
- |
- |
- |
- |
- |
Total |
1176 |
- |
- |
198 |
75 |
EMPLOYEE RELATIONS (ER) / INDUSTRIAL RELATIONS
The Employee Relations / Industrial Relations Scenario remained peaceful & cordial
during the year. Effective communication between the Management and the Trade Unions /
Associations paved way for smooth relations / maintenance of industrial harmony and to
eliminate any scope of conflicts & misunderstandings. Meetings with the
representatives of the Recognized Unions / Officers Associations at the Divisional,
Complex & Corporate Levels were held periodically to discuss various issues.
Plant Level & Shop Level Committees with representatives from the Management /
Union are functioning in the Divisions to discuss & resolve production related
matters. In order to address Employee Grievance / Representations, Grievance Redressal
Mechanisms are also in place in the Company.
RAJBHASHA IMPLEMENTATION
The Company is constantly taking efforts to implement Official Language in all the
Divisions/ Offices effectively. During the year, many initiatives have been taken such as
printing of all Technical Manuals, Form-Formats in bilingual.
As per directions given by First Sub-Committee, Committee of Parliament on Official
Language (CPOL) during the inspections, necessary directives have been issued to all the
Divisions/Offices of HAL to maintain expenditure towards the advertisements and publicity
as per Official Language guidelines.
Apart from this, Employees are being motivated through publication of In-house magazine
‘Nabharatna' at Corporate Office. ‘HAL Connect' – a weekly e-magazine is
also being issued in bilingual for encouraging the Employees to read technical literature
in Hindi also. Around 15-16 In-House Hindi Magazines are also being published by the
Divisions of HAL on annual basis.
Hindi Incentive Scheme has been implemented effectively. Further, Hindi roster related
information pertaining to knowledge of Hindi of the Employees is being updated for the
purpose of preparing time bound programme to train our Employees, who have no working
knowledge of Hindi, from forthcoming training session.
The periodical reports are also being sent and uploaded as per directives issued by the
Department of Official Language, Ministry of Home Affairs, New Delhi in this regard. As
per the Official Language guidelines, Hindi workshops are also being conducted on various
topics, so that Employees could do their routine work in Hindi effectively.
HAL website is being updated in bilingual from time to time at Corporate Office level.
Inspections of various divisions related to Official Language have been done successfully
during the year. The Officers from all the Divisions including Corporate Office are
attending TOLIC Meetings during the year. The actions on minutes of TOLIC meetings are
also carried out as per the decisions taken in the meeting.
The inspection reports pertaining to inspections of Ministry of Defence, Ministry of
Home Affairs and compliance reports related to assurances given to the Committee of
Parliament on Official Language are being sent to the concerned authorities/ offices in
time after reviewing the report at the Corporate Office level.
The meetings of Official Language Implementation Committee in all the divisions of HAL
including Corporate Office are being conducted regularly. Necessary guidelines issued by
the Dept. of Official Language, Ministry of Home Affairs, New Delhi are also being
circulated to all the divisions of HAL to make aware of latest orders pertaining to
implementation of Official Language.
WOMEN EMPOWERMENT:
Women Empowerment & Leadership Programs are being conducted by HAL. The main
objective of the programs is to enhance the Self-Awareness & Self - Management,
Managing Relationships, enhancing Business Leadership Skills, etc. Equal Opportunities are
provided to Women Employees at all levels for advancement in their career. Around 60 Women
Employees hold Senior Management posts i.e., above Grade VII.
HAL is a Corporate Life Member of the Women in Public Sector (WIPS) Forum. Women
employees are encouraged to participate in programmes / activities of WIPS Forum. All
statutory welfare amenities have been extended to women employees.
Ladies Clubs / Families Welfare Associations are also functioning at different
locations to take up various philanthropic / socio-cultural activities. Women's Day is
celebrated on 8th March every year.
PROHIBITION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal)
Act, 2013 has been notified in the Company. In line with the Guidelines received from time
to time, necessary actions have been taken to prevent Sexual Harassment of Women at
Workplace. The HAL CDA Rules applicable to Officers and the Certified Standing Orders
applicable to Workmen have the required provisions in this regard.
Internal Complaints Committees as per Section 4 of the said Act have been put in place.
Information for the year 2022-2023 in terms of Section 22 of the Act, is as indicated
below:
| (i) Number of Cases pending as on 01/04/2022 |
: Nil |
Number of Complaints of Sexual Harassment (ii) received in the
Financial Year 2022-2023 |
: 1 |
(iii) Number of Complaints disposed of during the Financial
Year 2022-2023 |
: 1 |
(iv) Number of Cases pending as on 31/03/2023 & its
status |
: Nil |
Awareness Programme on Sexual Harassment were also conducted at Divisions / Offices
during the year.
INFORMATION TECHNOLOGY (IT) INITIATIVES
During the year, your Company has taken many IT initiatives towards adopting the latest
technology, increasing customer satisfaction, implementing paperless processes and
improving cyber security. Some of the major IT initiatives and achievements of the Company
during the period are:
HAL Website : The Company has taken Initiative to revamp the website to serve as a
digital platform for marketing, suppliers, employees and other stake holders with new
features such as dynamic content management, multilanguage support, browser & device
independent web structure, real-time stock price, employee/retiree section etc.
Customer Relationship Management Initiatives:
Towards development of customer relationship management, the Company has developed a
centralised portal for registering customer complaints and the dashboard for quick supply
of ARS items by providing a single screen view of the current stock position of ARS parts.
Paperless Initiatives: A project management portal has been developed for providing
a platform for collaboration, transparency and timely resolution of design and production
related issues between Design and Production Divisions. Further , Online portal for
evaluation of performance for monthly incentive of indirect labour and Online Claim Bills
Realization System (e-CBRS) has also been developed.
Infrastructure & Cyber Security
?As part of strengthening the cyber security posture of the Company, initiatives
undertaken for ISO 27001 certification for all Production Divisions, R&D Centres and
Offices of HAL. Twenty two (22) Divisions/R&D
Centres / Offices have completed the certification in the current financial year.
Implementation of cloud based secure medium for sharing sensitive information with
external agencies.
AWARDS & RECOGNITIONS
During the year, your Company has received various Awards and Recognitions. Some of the
important accolades conferred to the Company are as under:
Raksha Mantri Award for Excellence in Defence and Aerospace Sector for the year
2021-22 under "Raksha Anveshan Ratna" Award (Institutional Award) category for
the project titled "Development of Indigenous Automatic Flight Control System (AFCS)
for the Light Combat Helicopter (LCH).
"IIIE Performance Excellence Award-2022" conferred for the outstanding
contribution made by the Company towards excellence in performance.
Prime Minister's Award for excellence in administration under the category
Innovation-Central to the team "Innovation for Defence Excellence (i-DEX) of
Department of Defence Production, Government of India."
Dun & Bradstreet PSU award in the ‘Heavy & Engineering (Central PSUs)'
category during ‘PSU and Government Summit 2022'.
"MRO Excellence Award" from the MRO Association for setting up the
Airport Infrastructure at Nashik and third party
MRO under the convergence mission of Govt. of India.
"IEI Industry Excellence Award 2022" under ‘Engineering
Manufacturing and Processing' category for demonstrating outstanding performance with a
high order of business excellence.
"Gover nance Now PSU Award" under the categories Nation Building and PSU
IT Award (Digital PSU and Use of emerging technologies - Enterprise Security sub
categories) amongst the Navratna Companies.
"Business Standard Annual Award for Corporate Excellence 2022" under the
category "Star PSU of the year".
"ICC PSE Excellence Award" under the category "Inclusivity -
Contribution of Women and differently abled in PSEs".
VIGILANCE
YourLabourCompany has a well-established Vigilance Department headed by the Chief
Vigilance Officer (CVO). Vigilance Officers and Staff are posted to the Corporate Office
and all the Divisions and Complex Offices of the Company.
The major vigilance activities carried out by Vigilance department are as under: i.
Pr eventive Vigilance:
During the period, 391 complaints were handled, 462 regular scrutiny/ surprise checks
and 28 CTE type intensive examinations were carried out across the Company. Five system
studies were carried out on various topics like scrap disposal, insourcing purchase
orders, implementation of PPI order placed on class I & II vendor and check of Minimum
Local Contact (MLC) certified by the vendors, procurement of shelf life items with focus
on total procurement and its utilization/non utilization, study on LC payments
–delivery schedule and applicability of liquidated damages etc.
A total of 87 awareness sessions were conducted on various topics. Key note address /
talk by eminent speakers were organized to spread vigilance awareness among employees on
various topics like preventive vigilance through preventive forensics, online banking
transactions and related frauds, financial frauds in commercial procedure, maintaining
professionalism, transparency and accountability in public procurement, PIDPI, complaint
handling policy and sensitization on the ill effects of corruption etc.
Medium ii. Vigilance Publications: Three in-house Vigilance e-magazines were
published during the year, as under:"Marg Darshan", a bi-annual magazine was
circulated during the year on the theme "Independent India
@ 75: self-reliance with integrity" and "Leveraging technology to prevent
corruption" covering articles from internal and external writers as a part of efforts
towards spreading preventive vigilance concepts.
"V ishleshan-II", a compendium of interventions was also published during the
year. Vishleshan-II is a compendium of selected cases bearing a vigilance angle, set of
case studies to succinctly draw up the mistakes made in a process and highlight lessons to
be learnt and system improvements to be made to avoid the same mistakes in future.
"Do' s & Don'ts", a compendium of HAL regulations was also published
during the year. ii
i. System Improvement measures: Based on the recommendations of vigilance, several
system improvements have been issued by the management in the areas of HR, IMM, stores,
works and finance etc like verification of education / caste certificates, guidelines for
preparing material adequacy and issue of raw material, guidelines for Annual Maintenance
Contract (AMC) of plant & machinery including test equipment, declaration of value for
insurance purpose repair and return cases, procedure for payment of royalty, remittance of
PF & ESI, engagement of external enquiry officers for conducting departmental
enquiries, submission of false declaration for availing Company medical facility and
improvements in weigh bridge operations etc.
i
v. Vigilance Awareness Week: Vigilance awareness week was conducted throughout the
organization at all divisions of HAL in nine different geographical locations across
country from October 31, 2022 to November 6, 2022, on the theme "Corruption free
India for a developed Nation". Awareness campaign comprising of in-house and public
outreach activities were conducted to spread awareness among employees & general
public.
QUALITY INITIATIVES AND SAFETY
Thir d-Party Inspection (TPI) model for inspection at vendor premises has been
successfully deployed. As on date, seven TPI bodies have been empanelled by HAL to carry
out inspection of outsourced components on behalf of HAL Divisions at the premises of
sub-contractors. The 7th TPI body was empanelled in FY 2022-23 in-coordination
with DGAQA, HQ New Delhi. Further, five HAL Divisions have placed orders to the TPI bodies
for inspection related activities.
Operator Self Verification program in coordination with DGAQA, has been introduced
for empowering shop operators / technicians to carry out inspection under delegation for
non-critical inspection stages leading to pride of ownership of one's work and increased
awareness towards quality.
HAL T Kanpur, Hyderabad & Korwa divisions have AD received additional Nadcap
certifications in ‘Chemical Processing' for chromic acid anodizing, painting and
chromate conversion coating respectively which will increase the process reliability and
enhance business prospects for the organization.
HAL Avionics Division, Hyderabad has been certified under the Occupational Health
and Safety Management System in accordance with ISO 45001:2018 which will promote safe and
environment friendly working conditions.
Avionics Division, Korwa has obtained Production and Organization Approval (POA) as
per Civil Aviation Requirements (CAR-21) Subpart G from DGCA for Solid State Cockpit Voice
& Flight Data Recorder and Control Unit for Hindustan 228-01 & Do-228-01
aircrafts. This will enhance the support for the Company in Civil Aviation endeavors.
AUDITORS
Statutory Auditors
HAL being a CPSE, Statutory Auditors of the Company were appointed by the Comptroller
& Auditor General of India (C&AG). M/s A. John Moris & Co., Chartered
Accountants, Bengaluru was appointed as Statutory Auditors for auditing the Accounts of
the Company for the year 2022-23 and 17 firms of Chartered Accountants were appointed as
Branch Auditors. The statutory auditors' report does not contain any qualification,
reservation or adverse remarks.
The Auditors' Report on financial statements for the financial year 2022-23 and
comments of the Comptroller & Auditor General of India (C&AG) under Section 143(6)
of the Companies Act are attached to this Report, which is self-explanatory.
Cost Auditors
Your Company has appointed M/s GNV & Associates, Cost & Management Accountants
as Cost Auditors for conducting the Cost Audit of the Company for the year 2022-23. The
Company maintains cost records as specified by the Central Government under Section 148(1)
of the Companies Act, which are audited by Cost Auditors.
Internal Auditors
The Company has appointed 14 (fourteen) Nos. of Chartered Accountant firms for carrying
out internal audit of the Company for the year 2022-23.
Secretarial Auditor
In terms of Section 204(1) of the Companies Act, the Company has engaged M/s. DPSP
& Associates, Company Secretaries, Bengaluru to conduct Secretarial Audit of the
Company for the year 2022-23. The Secretarial Audit Report is annexed to this Report as Annexure
- IV and forms part of Annual-Report.
The management's reply on the qualification of the Secretarial Auditor, form part of
Secretarial Audit Report, which is self-explanatory.
Annual Secretarial Compliance Report
The Company has filed the Annual Secretarial Compliance Report for the year 2022-23
with the BSE Ltd and National Stock Exchange of India Limited. The report was received
from a Practising Company Secretary and filed within the stipulated time as specified
under Regulation 24A of the SEBI (LODR) Regulations.
CORPORATE GOVERNANCE REPORT
In terms of Regulations 34 read with Schedule V of SEBI (LODR) Regulations and DPE
Guidelines, a report on Corporate Governance for the year ended March 31, 2023 has been
prepared and annexed to this Report. The Company's Secretarial Auditor has issued a
Certificate on Corporate Governance, which is appended to the Corporate Governance Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
As per Regulations 34(2)(e) of the SEBI (LODR) Regulations, the Management Discussion
and Analysis Report (MDAR) forms part of the Annual Report of the Company.
VIGIL MECHANISM
The Company has a Whistle Blower Policy approved by the Board. The details of the
Whistle Blower Policy are explained in the Corporate Governance Report and the same is
hosted on the Company's website at www.hal-india.co.in.
Employees are encouraged to raise any of their concerns by way of whistle blowing and
none of the employees have been denied access to the Chairman of the Audit Committee.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134(3)(c) of the Companies Act, your Directors
state that: (a) In the preparation of the annual accounts for the year ended March 31,
2023, the applicable accounting standards have been followed along with proper explanation
relating to material departures; (b) the dir ectors have selected such accounting applied
them consistently and made judgments and estimates that are reasonable and prudent, so as
to give a true and fair view of the state of affairs of the Company as on March 31, 2023
and of the profit and loss of the Company for the year ended on that date; (c) the dir
ectors have taken proper and sufficient the maintenance of adequate accounting records in
accordance with the provisions of this Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities;
(d) the dir ectors have prepared the annual accounts on a "going concern"
basis;
(e) the dir ectors have laid down internal financial controls which are being followed
by the Company and that such internal controls are adequate and are operating effectively;
(f) the directors have devised proper systems to ensure compliance with the provisions of
all applicable laws and that such systems were adequate and operating effectively.
ACKNOWLEDGEMENT
Your Directors are extremely thankful and acknowledge the excellent support extended by
the Government of India, in particular the Ministry of Defence, Department of Defence
Production, Defence Acquisition and Defence Finance as well as other Ministries of the
Government of India in all the endeavours of the Company.
Your Directors also place on record their sincere appreciation towards the Company's
valued customers, in particular the Indian Defence Services, for the support and
confidence reposed by them in the Management of the Company, and look forward to the
continuance of this mutually supportive relationship in the future.
The Company wishes to place on record its appreciation for the cooperation extended and
services provided by the Comptroller & Auditor General of India (C&AG), the
Principal Director of Commercial Audit & Ex-of_cio Member, Audit Board, Statutory/
Internal Auditors, Cost Auditors, Secretarial Auditors, Bankers, Collaborators, JV
Partners and Suppliers.
Your Directors are also thankful to the shareholders for the trust and confidence
reposed in the Company and look forward to their continued support to propel the Company
to greater heights.
Your Directors also wish to place on record their deep sense of appreciation for the
committed services by the Company's Executives and Workmen for progress and prosperity of
the Company.
|
For and on behalf of the Board of Directors |
|
Hindustan Aeronautics Limited |
|
(C B Ananthakrishnan) |
|
|
|
Director (Finance) & CFO |
|
Chairman and Managing Director (Addl charge) |
Place : Bengaluru |
Date : July 19, 2023 |