Cash position

Dividends & buybacks

Constant orderbook

BENGALURU: The issue of dues from the armed forces — ministry of defence (MoD) — continues to plague defence PSU (DPSU) Hindustan Aeronautics Limited (HAL), whose cash-in-hand has slipped back to a meagre Rs 140 crore as of March 31, 2019, official documents show.The MoD owes HAL about Rs 14,000 crore for the year ending March 31, 2019, and the pending bills are all for products and services the DPSU has already delivered. A majority of this is owed by the Indian Air Force (IAF); both the MoD and IAF have not responded to TOI’s query on the matter, sent on April 2, and 3, respectively.And, data from 2003-04 to 2018-19 show that the cash balance has never been this low. The lowest in this period was Rs 4,841 crore, in 2003-04. While the cash-in-hand has slipped by about 98% compared to Rs 6,524 crore as on March 31, 2018, receivables has nearly doubled from Rs 7,741 crore.Grappling with low finances, HAL, for the first time in many years was forced to borrow to pay salaries to its employees—it borrowed Rs 962 crore in December 2018 as its cash-in-hand was in the negative for the first time—which was first reported by TOI.As of December 31, dues from the armed forces stood at Rs 15,700 crore, and HAL CMD R Madhavan had said that it may touch Rs 20,000 crore by March 31. However, the MoD, has cleared some bills, and by end of March 2019, the pending dues are Rs 13, 938 crore.Notwithstanding its poor cash position, HAL has paid another interim dividend of Rs 662 crore to the Centre in 2018-19. This is in addition to the Rs 8,996 crore it paid as dividends between 2003-04 to 2017-18, more than 50% of which was done in just the last five years.Besides, for the first time in HAL’s history, the company paid up Rs 6,393 crore in two buy-backs in the past four years. The first buy-back of Rs 5,265 happened in 2015-16. The second one happened in 2017-18, when HAL paid Rs 1,128 crore.As its grapples with these issues, HAL’s order book position, however, has remained constant. As on March 31, 2019, it stood at Rs 58,000 crore — Rs 50,000 crore of this is for the last 12 Su-30MKIs, which HAL is likely to deliver by March 2020. The other orders including Dhruv and Cheetal helicopters.While no new orders are reflected in the order book, defence minister Nirmala Sitharaman had, in January, said that orders worth Rs 1 lakh crore were in the pipeline. Among the major orders she spoke of were 83 Light Combat Aircraft (LCA) Tejas worth Rs 50,000-crore, 200 Kamov helicopters worth Rs 20,000-crore, 15 Light Combat Helicopters (LCH), 19 Dornier aircraft and the aero engines for Su-30 upgrade.However, the LCA is still at the request for quotation level and the bid is still being negotiated. It’s the same with Kamov helicopters, orders for which will actually be placed with Indo-Russian Helicopters Limited (IRHL), an HAL subsidiary jointly run by Russian Helicopters and another Russian agency.Russian Helicopters Director General Andrey Boginskiy, in an exclusive interview to TOI said the firm was unaware of the worth of the deal as cost negotiations had not begun yet.