With Rs 10k-cr unpaid dues, armed forces add to HAL woes

Source:-With Rs 10k-cr unpaid dues, armed forces add to HAL woes

Defence PSU HAL, grappling with delayed fund release from its budgetary allocation and depleting order book that has has resulted in its cash-in-hand dip to as little as Rs 1,000 crore, has its hopes set on the massive outstanding dues from the armed forces to stay afloat without having to borrow money.

A company mainly dependent on the armed forces for its business—its export business and work it does for Isro are negligible—HAL’s customers owe the firm at least Rs 10,000 crore as of September 30, sources said. At the end of March 31, 2018, as per HAL’s annual report, the outstanding dues from the armed forces stood at Rs 7,900 crore, and the number remained around the same for the quarter ending June 30.

“As of the quarter ending September 30, the dues have touched Rs 10,000 crore, HAL will make it public by October 30,” a source in the know said. The source added that as of Tuesday the dues have increased further.

The cash balance HAL has, as TOI had reported earlier, is not even sufficient to pay salaries to its 29,035 employees for three months, which comes up to Rs 358 crore every month. HAL will be forced to borrow money from outside if it does not receive money from one of its sources soon.

HAL is hoping that the government releases money as part of the budgetary allocations for 2018-19—only 40% has reached the firm so far—or that the dues owed to the firm is paid by the armed forces. “Our Board has been trying to impress upon the officials at the ministry of defence about the same, but to no avail so far,” another source said, adding that defence minister Nirmala Sitharaman has not visited even once in her tenure.

The ministry of defence (MoD) did not respond to TOI’s query on why there was a delay in the armed forces making payments that are due to HAL. The email to MoD was sent on Monday evening.

“This has had a massive impact on the firm, which will be forced to borrow money to even pay salaries if the money does not flow in soon,” another source said.

Another major decision that reduced HAL’s cash balance, as insiders claim, is share buybacks. The first buyback happened in 2015-16, while the second one happened in 2017-18.

In March 2016, then HAL CMD T Suvarna Raju had said in a statement: “HAL has made a massive contribution of Rs 4,284 crore to the Government as buyback of 25% of the share capital and free reserves from HAL.” This amount did not include the interest component, which was another few hundred crores. Further, in December 2017, HAL paid another Rs 921 crore (minus taxes) for the second buyback.

 

 

 

 

 

Source:- TNN

The post With Rs 10k-cr unpaid dues, armed forces add to HAL woes appeared first on Indian Defence Update.Indian Defence Update -
Please Visit Our Site For Latest News On Indian Army, Navy and Airforce Indian Defence Update.



from Indian Defence Update https://ift.tt/2CENYHs
via IFTTT
With Rs 10k-cr unpaid dues, armed forces add to HAL woes With Rs 10k-cr unpaid dues, armed forces add to HAL woes Reviewed by Unknown on 22:40:00 Rating: 5

No comments:

Defense Alert. Powered by Blogger.