Dear Stakeholders,
I am honored to extend a very warm welcome to you all to the Ninetieth Annual General Meeting(AGM)
of the Company. The Directors'
Report and Annual Accounts of the Company for the Financial Year 2022-23 have already been circulated
to you. It is a matter of privilege and responsibility that I am announcing the results of this fiscal
year through the Annual Report of the Company. I am delighted
to inform that best efforts by MDL collective have resulted in achieving several ‘Best Ever'
milestones across the Business Operations of your Company during the FY 2022-23.
Your Company delivered two major platforms, the second Ship of Project 15B (Missile
Destroyer) - INS Mormugao on 24 Nov 2022 and the fifth Scorpene Submarine of Project 75
‘Vagir' to the Indian Navy on 20 Dec 2022.
Performance in FY 23
It gives me immense pride to convey that your Company in the Financial Year under
review has recorded highest ever Revenue from Operations of Rs.7,827 crores and highest
Operating Profit of Rs.716 crores. The Profit
after Tax for the Year was recorded at Rs. 1,073 crores, higher by 83% over previous
Financial year. Total income has increased by 39% from Rs. 6,167 crores in FY 2021-22 to
Rs. 8,541 crores in FY 2022-23. Book value per Share has increased from Rs. 164.68 in FY
2021- 22 to Rs. 207.13 in FY 2022-23. Net
Worth has increased by 25.78% from Rs. 3,321 crores in FY 2021-2022 to Rs. 4,178 crores
in FY 2022-23 and EPS increased from Rs.29.08 in FY 2021-22 to Rs.53.19 in FY 2022-23. The
excellent performance in FY 2022-23 is wide ranging and encompasses outstanding
Operational and Financial performance across all functions.
The Company has been consistently earning Profits and distributing Dividend for the
past more than 15 years. As advised by the Government, Company has earlier paid an Interim
Dividend of Rs. 9.10 per equity share, amounting to Rs. 183.54 crore. It was duly approved
by the Board of Directors in their meeting held on 10 Nov 2022. The Board of Directors
have now, further recommended a Final Dividend of Rs. 138.36 crores for FY 2022-23.
Your Company achieved a Historical Double Launch of a Missile Destroyer
"Surat" and a Frigate "Udaygiri" on 17 May 2022. Both the vessels were
"Launched" in the august presence of Hon'ble Raksha Mantri, Shri Rajnath
Singh.
Your Company delivered two major platforms, the second Ship of Project 15B (Missile
Destroyer) - INS Mormugao on 24 Nov 2022 and the fifth Scorpene Submarine of Project 75
‘Vagir' to the Indian Navy on 20 Dec 2022. I take pleasure in highlighting that
the second Ship of P15B was delivered about
three months ahead of the contractual delivery schedule.
Your Company Launched the sixth Submarine "Vaghsheer" on 20 Apr 2022 &
stealth Frigate "Taragiri" of Project 17A on 11 Sep 2022.
Your Company Launched Fuel Cell Electric Vessel (FCEV) on 01 Jul 22 being India's
First Indigenous Hydrogen Powered Fuel Cell Electric Boat. This is a six Pax Boat that
runs on Hydrogen with an endurance of 22 Hours. Further, your company is in the process of
building four more FCEVs of 24 Pax capacity each.
Your Company was Accredited with ISO 14001:2015 & ISO 45001:2018 (HSEMS)
on 28 Jul 2022 and ISO/IEC 27001:2013
on 19 Oct 2022.
During the period under review your Company successfully conducted various significant
events and won 4 accolades in the form of recognition and awards, detailed in the
Directors' Report, thereby demonstrating the varied competencies of the Company.
Performance against MOU
During the year, your Company had signed Memorandum of
Undertaking (MoU) with Ministry of Defence, Government of India MoD for the financial
year 2022-23. The MoU outlines targets and various performance parameters for the Company.
The Value of Production was targeted at Rs. 7,654 crores (an increase of more than 34%
over the Value of Production achieved for FY 2021-22). Actual achievement of Revenue from
operations for the year is Rs. 7,584 crores for FY 2022-23. During the year, your Company
achieved a Profit Before Tax (PBT) before Exceptional items of Rs. 1,429 crores.
Human resources
Your Company has been putting emphasis on the overall growth & development of
Human Resources and is committed to continue its relentless efforts in updating the
competencies of its executives through exposure to various Learning & Development
initiatives by Institutes of National Importance and through sponsoring functional based
Seminar
/ Conferences / workshops. Besides, in order to ensure smooth supply of skillsets for
Company's requirement and shipbuilding industry, various training programs viz.
trainings of Trade Apprentices under the Apprentices Act, 1961, BOAT Apprentices and
Marine Engineering students under the aegis of DG, Shipping at the Company's
run Apprentice Training School have regularly been organized. A list of Programmes /
Trainings conducted during FY2022-23 is provided in the Directors' Report.
Indigenisation efforts
Your Company had set up a dedicated ‘Department of Indigenization' in Nov
2015, to provide focused impetus to the Hon'ble Prime Minister's "Make-in-
India" initiative and through this your Company has been successfully able
to partner with the Indian industry to undertake indigenization/import substitution of
various equipment/ items which otherwise are being imported.
Your Company has been able to successfully indigenize some of the critical
equipment/items required for warships and submarines as detailed in the Directors'
Report. The procurement of the indigenized items from the
Indian industry would not only result in substantial savings in foreign exchange to the
exchequer but also contribute towards National Capability Building.
As a major leap, in line with National Mission of "Atmanirbhar Bharat" and
"Make in India" and with an
aim of indigenizing the design of conventional Submarines, MDL and initiated an
ambitious program of Design and Construction of Indigenous Conventional Submarine.
Further, MDL has volunteered to MoD to be the nodal agency for Conventional Submarine
Design and to collaborate with IN, GoI agencies and Private Industries.
In addition to the indigenous Hull design and construction, a mega plan for
Indigenisation of equipment for existing / future Submarine Projects under
‘Atmanirbhar Bharat' and ‘Make in India' program has also been
initiated. Towards this, MDL have analysed all the 8000 equipment
and material required for building Submarines. These 8000 components have been mapped
to 165 equipment. 35 out of total 165 Submarine equipment have been indigenized. In
addition, Project Specific Order (PSO) for 26 equipment have been issued including Main
Electric Propulsion Motor and 31 additional items are at an advanced stage of order
placement.
Marketing initiatives
17. Your Company participated in DEFEXPO 2022 in Gandhinagar and Africa Aerospace
and Defence (AAD) in City of Tshwane – South Africa as an exhibitor for marketing and
Business promotions. The exhibitions were
successful in projecting the image and capabilities of India in the defence production
sector in general and
warship/submarine building capabilities in particular. MDL delegation visited 16th
International Defence Exhibition 2023 (IDEX) and the 7th edition of Maritime Defence
Exhibition 2023 (NAVDEX) held in Abu Dhabi. MDL
was also part of Ministry of Defence,
Government of India delegation that visited and participated in the seminars held in
Tanzania, Malaysia,
Australia and Bangladesh organized by High Commission of India. During the seminar MDL
interacted with the Armed forces / Navy representatives wherein Indian shipbuilding
capacities and capabilities were showcased.
Research & Development
Under the "Atmanirbhar Bharat" initiative, MDL has undertaken the
challenge of Indigenously Designing and Development a Midget Submarine.
Many other innovative R&D projects are currently in progress at Special Projects
section under East Yard through collaboration with Academic Institutions, Start Ups &
industry not only in the defence sector but also
in the field of Energy and other Civil applications. Military products like Expendable
Underwater Target (EUT) and Mobile Target Emulator (MTE) are being developed in
partnership with the Industry and are designed to
simulate the situation of actual moving Submarine for training purpose
and for decoy measures.
MDL has developed and launched India's first Fuel Cell powered Electric Vessel
(FCEV) as a ‘Proof of Concept'. This will provide a sustainable green technology
solution for waterways transportation with zero emissions. Modern marine transport
solutions like Hybrid Electric & Solar boats which can provide an environment friendly
options are also under development. This hybrid boat can offer a better alternative to
conventional diesel
boats. The R&D team is also developing prototype of Lithium Ion Battery system
solution for conventional Submarines.
Your Company has executed and completed trials for three major R&D projects,
through Industry-Academia participation with IIT Madras, Chennai through their incubated
start-
ups belonging to the Tamil Nadu Corridor. The AI products are now 100% operational and
are deployed in-house for weld inspections and underwater inspections. Once the AI
learning is completed with the current deployment, the
commercialization of these AI products will be explored.
Your company is also exploring development of innovative AI projects with the help of
Domestic Industry,
Academia and Startups. Some of the major projects includes Artificial
Intelligence (AI) enabled Autonomous Underwater Swarm Drones, Artificial Intelligence
Based Predictive Maintenance of Ship Equipment and Artificial Intelligence Based Energy
Management of Fuel Cell.
The in-house projects as well as projects in collaboration with
academic institutions of repute like Welding Research Institute, Trichy, IISc Bangalore
and NID are all aimed at solving the unique issues faced by the Ship Yard during the
detailed Design and Integration of complex systems into a front line Naval platform. The
specialists' groups functioning under GM (Design) contributes consistently in the
areas of Structural analysis, Ergonomics & HFE, Noise & Vibration
Control, RCS management, Propulsion system integration, Materials and HVAC.
Exports
Your Company working on establishing its presence in the export
market.
MDL has been in dialogue with various Indian Embassies / High
Commissions abroad to expand its product outreach to prospective customers. The
commercial shipbuilding sector
world-wide is passing through a down turn and MDL is deeply aware of the situation.
Nevertheless, the defence requirements in the international market continues to remain
relevant. Your Company has certain unique strengths and skill sets that have been
painstakingly developed in the past eight decades and are adapted
in the complex activities of Weapon Integration & Sensors for high tech Defence
platforms.
Your company is exploring all possibilities of exports. Efforts are on for pursuing
exports with various
countries following both the G2G route wherein the GoI have opened Lines of Credit with
funding typically extended by EXIM bank as well as the B2B route with Sovereign guarantee
of the recipient nation.
Swachh Bharat initiative
Your Company, adhering to the Prime Minister's Swachh Bharat Abhiyaan, has
made a positive impact in creating mass awareness movement in and around MDL and bring
about lasting behavioral change in the society through participation of employees at all
levels as well as the people from the surrounding area.
- Clean-ship of adjacent areas / Roads of MDL by external agency: MDL has engaged an
agency for carrying out daily cleaning of roads (approx. 4.5 km) adjacent to MDL.
- MDL carried out special Swachhta Drive at Sewari Fort.
Corporate governance
Your Company is complying with the Guidelines on Corporate Governance for CPSEs
issued by the Department of Public Enterprises (DPE) and SEBI(LODR) Regulations. Necessary
disclosures have been made in this regard in the Corporate Governance Report.
Green initiatives
Your Company has engaged various initiatives towards sustainable development and
energy conservation in the year under report. Your Company is committed to reduce the
consumption of energy generated
by fossil fuel and to increase the generation of renewable energy to the maximum
possible extent. Your Company has already installed 1.85 MWp Roof Top solar power plant,
procured 40,000 Nos of 110V LED bulbs and 40 Nos of LED Flood lights.
Corporate social responsibility
Your Company is committed to all its stakeholders to conduct business in an
economically, socially and environmentally sustainable manner as part of its CSR &
Sustainability
policy. Your Company has executed 27 projects as part of its CSR initiatives mainly in
sectors of Education, Health & Sanitation, Skill Development and Village Development.
The executed projects are in line with schedule VII of the Companies Act. Your Company
has spent Rs.12.61 crores towards CSR activities during FY 2022-23. A sum of Rs.5.87 crore
remains unspent as several projects/ programs could not be accomplished/ completed due to
delay in the submission of required documents and
/or delay in execution of some projects by the implementing agencies
Future outlook Infrastructure:
- Your Company plans to set up a green field shipyard at its Nhava Yard in a phased manner
with short term and long term development plans based on better visibility with respect to
large ticket orders.
- Your Company would be building a New Floating Dry Dock of
12000T capacity to undertake the construction of advanced and next generation vessels.
- Your Company is committed towards creating a skill development hub with an Apprentice
Training School (ATS) and associated development work at Gavhan village, Navi Mumbai.
Ongoing Projects:
It is a proud achievement that inspite of severe impact on Operations
due to the prolonged pandemic situation worldwide, your company successfully delivered
five Kalvari Class Conventional Submarines to Indian Navy between 2017 to 2022. Further,
your company also successfully delivered two Missile Destroyers to the Indian Navy one
each in FY 2021-22 and FY 2022-23, highlight being that both these Ships were delivered to
the Indian Navy within the contractual timelines. All efforts are being made to
complete the balance vessels under each of these Projects, i.e, Project 75, Project 15B
and Project 17A, MRLC of SSK Submarines on priority.
Concluding remarks
The Board of Directors join me in gratefully acknowledging the valuable guidance
and support received from the Ministry of Defence in shaping and framing various policies
as well as helping us in implementing them. The Board of Directors also expresses sincere
gratitude for the assistance,
co-operation and guidance received by the Company from various Ministries of the
Government of India, Indian Navy, Greater Mumbai Municipal Corporation, Mumbai Port Trust,
Principal Controller of Defence Accounts (Navy), the Departments of Customs, Income
Tax and GST, Principal Director of Commercial Audit, Statutory Auditors M/s C R Sagdeo
& Co., Bankers and the Stakeholders. I take this opportunity to place on record our
appreciation of the high standard of professional acumen, patronage and support from the
Indian Navy and other clients.
I am grateful to the Board of Directors for their unwavering support and guidance, in
maintaining the corporate image of your Company. Your Company has been and shall always
remain committed towards "self- reliance in defence preparedness" by producing
State-of-the-Art combat platforms thereby adding teeth to
the Indian Naval fleet and Coast Guard, and to play a pivotal role in the maritime
defence of our great nation. On behalf of the Board, I acknowledge and appreciate the
excellent commitment and efforts and continuous contribution of the employees at all
levels, who have
enabled your Company to maintain its path of progress.
We shall endeavour our best performance and seize every opportunity to play a critical
role in shaping the maritime defence of our Country and to constantly, enhance our human
skills and innovate and transform as required to meet the challenges of the future.
Jai Hind!
Sanjeev Singhal
Chairman & Managing Director (Additional Charge) w.e.f 01.02.2023 and Director
(Finance) & CFO
DIN: 07642358