Hindujas want big slice of defence pie

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    Hindujas want big slice of defence pie

    Swaraj Baggonkar / Mumbai October 12, 2011

    The Hinduja Group has decided to cash in on India’s defence requirements, by realigning its holding company, Hinduja Automotive, as a one-stop shop for all military hardware — from specialty trucks, artillery and combat systems to aerospace components and engineering services.

    Hinduja Automotive, which makes trucks and buses under the Ashok Leyland brand, will line up alongside several other domestic companies to make substantial gains from defence contracts to be offered by the Indian government, the world’s 10th largest spender on military hardware, under the offset clause.

    While its subsidiaries such as Ashok Leyland Defence Systems have partnered with international companies to make products like armoured vehicles, the firm is scouting for partners to foray into the civil and defence aerospace. Taking over a foreign company or forging partnership is also on cards. The company is evaluating options it gets from investment bankers on different companies on a regular basis, however it’s yet to zero in on a suitable company, said a senior official.

    V Sumantran, executive vice-chairman, Hinduja Automotive, said, “We are definitely looking at being involved in the defence sector. There is an urge from the group to grow in high-value technical areas, where we could be related to mobility solutions. Related areas like aerospace, defence construction equipment, trucks and buses are where we are scouting for opportunities.”

    Tata Motors, subsidiaries of Mahindra & Mahindra, Bharat Forge, MRF and Sona Koyo, among others, have lined up to benefit from the defence contracts under the Defence Procurement Policy.

    Contracts worth more than Rs 45,000 crore under the offset clause will be awarded to various companies over the next 5-10 years. Over 35 Indian companies, both in the public and private sectors, would jostle for the contracts.

    With the Air Force expected to make up a bulk of the defence spends, several Indian companies are looking for partnerships with high-end solution providers for technology sourcing.

    Detroit-based Defiance Technologies, a Hinduja Group company, is supplying engineering services to a large European civil airliner. The group is scouting for targets in this region and is awaiting the right partner to tie up.

    Sumantran said, “We are working with the Defence Research and Development Organisation on some projects in India. We are working with some defence contractors in North America. So, we already have some work going, but we are working on aerospace presently.”

    Ashok Leyland Defence aims to be an end-to-end solutions provider. It presently makes light specialty vehicles, mine protected vehicles, general services role, light recovery vehicles, high mobility vehicles, fire fighting trucks, field artillery tractors and other special applications.

    It recently signed a memorandum of understanding with Krauss-Maffei Wegmann GmbH & Co KG, Munich, Germany, to make armoured wheeled vehicles, recovery vehicles, artillery and combat systems and bridge-laying systems, among other things.
     
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