Bharat Forge arm forms JV with Rafael Advanced Defense Systems

[Water Car Engineer]

NEW DELHI: Auto component major Bharat ForgeBSE -0.97 % arm Kalyani Strategic Systems today entered into a joint venture partnership with Israel's Rafael Advanced Defense Systems to bid for defence programmes in India, including infantry combat vehicle BMP II upgrade.

The joint venture company Kalyani Rafael Advanced Systems Pvt Ltd will look to address programmes in relation to BMP II upgrade, tactical control systems, other advanced systems and other such programmes floated or to be floated by the Ministry of Defence, Bharat Forge said in a BSE filing.

The company, however, did not share details of the JV such as stake holding between the partners.

Bharat Forge has been a key supplier of components to the Indian defence establishment for over 30 years. It has stated that it would focus on capturing opportunity arising out of Make in India initiative of the government through supply of critical components in both defense and aerospace sector.

Rafael develops and manufactures advanced defense systems for the Israeli defense fo ..

Read more at:
Bharat Forge arm forms JV with Rafael Advanced Defense Systems - The Economic Times

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Kalyani of India offers upgraded BMP-2 with new armour and Rafael Samson Mk II weapon station 170214 | Defexpo 2014 Show Daily News - Coverage - Report | Defence and security military army exhibition 2014

The Rafael Samson Mk II turret mounted on the Kalyani upgraded BMP-2 is armed with the 30mm automatic cannon from ATK and two anti-tank missile launchers Spike LR.

SPIKE-LR feature a fiber optic data communication link that provides the gunner with the unique ability to attack hidden targets, update or switch to a more valuable target after launch, achieve pinpoint precision, avoid friendly fire, conduct surveillance/damage assessment, and obtain real-time tactical intelligence. SPIKE-LR has Fire and Forget and Fire capability and can engage targets at up to 4000 m.

The Rafael Samson Mk II turret offers significant improvements, including lower silhouette, optional armour protection, and improved hit accuracy, boosted crew survivability with under-armour reloading, increased rigidity and higher gun elevation capabilities.

The Samson Mk II RWS boosts crew survivability by eliminating deck penetration. Additional crew protection is provided by a dedicated Rafael patent-pending in-hull reloading system. And for the vehicle itself, Samson Mk II RWS’s low-silhouette geometry enables the host platform’s surfaces to easily accommodate protective armor ranging from STANAG Level .1 to 4

The turret includes also two optronic sights MiniPOP (Plug-in Optronic Payload), one for the gunner and the other, providing an independent sight for the commander. Plug-in Optronic Payload (POP) is a modular, compact, competitively priced gyro stabilized day / night observation, surveillance and targeting system.

 

[Tshering22]

I want to know, how does Kalyani manage to survive without a single sales in arms? They've been doing everything to sell weapons just like TATA ALS but nothing has been bagged yet.

We still don't have TATA APCs or Kalyani armored cars yet.

 

[Water Car Engineer]

I want to know, how does Kalyani manage to survive without a single sales in arms? They've been doing everything to sell weapons just like TATA ALS but nothing has been bagged yet.

We still don't have TATA APCs or Kalyani armored cars yet.

I know, they're even trialing some artillery as we speak. And making a light 155mm artillery with Mandus. All this with no guarantee of getting any orders. And look at OFB, these losers are getting an automatic inclusion to the FICV program. It's a joke really.

 

[Abingdonboy]

I want to know, how does Kalyani manage to survive without a single sales in arms? They've been doing everything to sell weapons just like TATA ALS but nothing has been bagged yet.

We still don't have TATA APCs or Kalyani armored cars yet.

Celarly the revenues from BF are keeping Kalyani afloat. incidentally the new DPP rules should address the very troubles you speak of- the MoD will fund 90% of costs to develop prototypes and R&D for equipment they end up procuring.

 

[PARIKRAMA]

According to Icra Ratings from June 2015

The long term rating upgrade reflects steady improvement in BFL’s capital structure and coverage indicators in the backdrop of healthy cash accruals from operations and subsequent repayment of debt. Also, over last two years, company is in consolidation mode wherein it has exited its loss making overseas subsidiaries whereas performance of Indian as well as European operations have also improved on sequential basis. BFL is one of the key beneficiaries of recovery in US M&HCV and PV industry, wherein its exports to US has almost trebled between Q4FY13 to Q3FY15. On account of improved operating leverage, favourable foreign exchange movement (BFL is net exporter) and better product mix (higher non-auto/machined components), operating margin improved by sharp 447bps YoY to 30.2% during Q3FY15 and 353bps YoY to 29.2% during 9mFY15.

The company has adopted a more conservative approach to capacity additions – generally capacity additions are now backed by confirmed order; hence, the asset turnover as well as return indicators (RoCE, RoNW) should also improve going forward. Over last one year, company has replaced some of its rupee denominated debt with foreign currency debt (via ECBs) to fund its capital expenditure/investment plans - given company’s net exporter status, ECBs provides a natural hedge to the company against foreign exchange movement. BFL’s liquidity profile continue to remain strong with liquid investments/cash surplus of over Rs 1,000 crore (as on Dec’14) and sizeable unused bank facilities.

The ratings also draws comfort from BFL’s dominant position in the global automotive forgings industry, especially in the CV chassis and engine component space, its large scale of operations, strong and diversified customer base across auto and non-automotive segments & geographies and its technical capabilities. The rating strengths are partially offset by BFL’s moderately leveraged capital structure especially in view of ongoing investments and high working capital intensity, with sizeable portion of debt involving bill discounted of reputed customers. ICRA also takes note of BFL’s dependence on cyclical CV industry, which has affected performance of domestic operations in the past. Nonetheless, ICRA believes that BFL’s business model has improved as reflected by lower break-even levels especially in the European operations, scale-up in non-automotive business and steady cash generation from existing business streams.

http://www.icra.in/Files/Reports/Rationale/Bharat Forge_r_05052015.pdf

Clearly the cashcow BF is supporting Kalyani Strategic Systems with all risks borne through financial strength of BF