HAL becomes the 14th Maharatna CPSE in India

Hindustan Aeronautics Limited (HAL) will now be the 14th^the ‘Maharatna’ company among the Central Public Sector Enterprises (CPSE), the Finance Ministry announced on Saturday. This status will give the company more autonomy in financial and strategic terms.

HAL is a CPSE of the Department of Defense Production (DoDP) with an annual turnover of ₹28,162 million and a net profit of ₹7,595 million for the fiscal year 2023-24. HAL shares closed at ₹4,446.85 on Friday, a loss of 0.76 percent from the previous closing price.

“The Finance Minister has approved the upgrade of Hindustan Aeronautics Limited (HAL) to 14th Maharatna CPSE,” the Department of Public Enterprises said in a social media post on X. Further, it said that the proposal had earlier been recommended by both Inter-Ministerial Committee (IMC) headed by the Finance Secretary and the Apex Committee headed by the Cabinet Secretary.

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The government has laid down six key parameters for a CPSE to be considered for granting Maharatna status. These include the CPSE already with the status of ‘Navratna’. It needs to be listed on the Indian stock exchange, with a minimum public shareholding prescribed under SEBI regulations. It should have an average annual turnover of more than ₹20,000 million, an average annual net worth of more than ₹10,000 million and an average annual net profit of more than ₹2,500 million during the last three years. The CPSE must have a significant global presence or international operations.

Talking about its future prospects, the company’s annual report (2023-24) states that in the Defense segment, the demand for Indian Defense Services products is expected to grow, owing to the Government of India’s vision to achieve Atmanirbhar Bharat and the current scenario geopolitical. On the commercial side, air travel is likely to continue its upward trajectory. The increase in air travel will lead to an increase in demand for new aircraft and MRO services.

“India’s annual defense production is expected to reach 3 lakh crore by 2028-29, along with arms exports of ₹50,000 crore,” the report said, quoting Defense Minister Rajnath Singh. This indicates that the Indian Defense Sector, which until now contributed as a strategic sector, is gradually developing into an economic sector with the capacity and vision to contribute to the economic growth of the country. Various GoI initiatives have given impetus to indigenization of defense equipment to reduce defense imports as well as dependence on foreign OEMs, the report added.

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Furthermore, he highlighted that, to encourage R&D in industry, start-ups and academia, the Ministry of Defense announced schemes such as Innovation for Defense Excellence (iDEX) and the Technological Development Fund (TDF). “In the next 5 to 10 years, these reforms will equally help Defense PSUs and private industry to achieve a self-sustainable Defense industry in the country,” the report stated.

Future projects like LCA MkII, Advance Medium Combat Aircraft (AMCA), Indian Multirole Helicopter (IMRH), Twin Engine Deck Based Fighter (TEDBF), etc., will ensure technological leadership of India and HAL, in particular, in the coming years. The Company has taken several initiatives to make systems more agile, effective, cost-efficient and competitive, the report mentioned