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Rediff.com  » Business » BEML bags Rs 1,672-cr Metro Rail order

BEML bags Rs 1,672-cr Metro Rail order

February 10, 2009 13:34 IST

Public sector undertaking BEML has raked up railway equipment and component orders of over Rs 4,000 crore (Rs 40 billion), company chairman and managing director V R S Natarajan said on Monday.

The first order worth Rs 1,672.50 crore (Rs 16.72 billion) from the Bangalore Metro Rail Corporation is for the supply of 150 metro coaches, including spares, for phase I of the project by October 2010.

BEML is expecting an additional order for 63 metro coaches for further expansion and extension of proposed metro lines in Bangalore city.

The rolling stock order will comprise 50 train sets of three cars each and will be implemented by a consortium comprising BEML, Rotem and Mitsubishi, Natarajan said.

Additional orders for the Bangalore Metro in the coming months, depending on requirements, are expected to involve supply of 30 coaches for Rs 300 crore (Rs 3 billion), and at a later point, a Rs 600-crore (Rs 6-billion) order for another 63 coaches.

The final supply chain for the Bangalore Metro alone is expected to be 243 coaches at a total cost of Rs 3,500 crore (Rs 35 billion), BEML officials noted.

Natarajan said that the company has received inquiries for metro rail projects from the Phillippines and Sri Lanka. The Bangalore Metro will only be the second after the Delhi Metro to employ the 1,435-mm standard gauge. Earlier, the company won orders worth Rs 1,365 crore (Rs 13.65 billion) from the Delhi Metro Rail Corporation for supply of Metro rail coaches.

Natarajan said that BEML has developed capabilities for 3-car and 6-car train configurations. "We are now doing a 8-car train project for DMRC," he said.

"In 6-car and 8-car configurations, the first car, which houses the control room, can also feature seating arrangements. So, we are in a position to raise passenger capacity per train to 1,600 people from the current capacity of 1,000 people."

BEML has delivered 430 coaches -- both second class air-conditioned coaches and overhead inspection cars -- to the Indian Railways this year. The order book could be carried forward to 230 coaches more in fiscal 2010, Natarajan said. BEML expects to ship 660 coaches to the Railways by the end of March 2010.

Its railway business is expected to post revenues of Rs 400 crore (Rs 4 billion)in fiscal 2009 and reach Rs 1,000 crore (Rs 10 billion) in fiscal 2010. Revenues from the railway business were Rs 172 crore (Rs 1.72 billion) in 2008.

BEML is in the process of setting up a Research and Development Centre of Excellence for Research in Metro Rail System on 10 acres of land in Bangalore at an investment of Rs 134 crore (Rs 1.34 billion).

The land has been leased by the company for nine years. "The new centre will help India become a export hub for metro rail equipment and components, and will be ready by June this year.

It will help keep the metro rail technologies updated and arrest obsolescence. We have tied up a central grant of Rs 125 crore (Rs 1.25 billion) for the project, with an additional Rs 9 crore (Rs 90 million) from BEML's side," Natarajan said.

BEML's new plant at Palakkad in Kerala, which will manufacture defence products and heavy equipment for the Railways, is set to be commissioned by 2012.

BEML has said that once operational, the plant will provide direct employment to nearly 1,500 people and indirect employment to more than 4,000 people.

A 'mini-Ratna' company under the ministry of defence, BEML Ltd was established in Bangalore in May 1964 for manufacture of rail coaches, spare parts and mining equipment.

The government has in recent years divested its equity holding in the company to FIIs and public and financial institutions as well as employees, and retained 54 per cent equity.

With eight manufacturing units, BEML caters to diverse sectors of the economy such as coal, mining, steel, limestone, power, irrigation, construction, road building, aviation, defence, and railways.

BEML achieved sales turnover of Rs 2,713 crore (Rs 27.13 billion) and pre-tax profit of Rs 348 crore (Rs 3.48 billion) during 2007-08.

Export earnings touched Rs 200.62 crore. In fiscal 2009, income from sales is expected to surpass the company's target of Rs 3,000 crore (Rs 30 billion) under the ERP system of accounting which the company has implemented last year.

Mulls low-cost Metro coaches for tier 2 cities

BEML has developed low-cost metro rail coaches for mass rapid transport systems at an estimated cost of Rs 6 crore (Rs 60 million) per coach.

Chairman and managing director V R S Natarajan told reporters on Monday that BEML is working with a Chinese company and other global suppliers to develop the low-cost coaches.

"We are looking at employing these coaches on MTRS in tier 2 and tier 3 cities which have shown potential for metro rail development. Hopefully, we will get some pilot orders soon," Natarajan said.

BEML is looking at support from the ministry of urban development and co-funding from upcoming metros to successfully implement the low-cost project, BEML director (rail & metro business) P Dwarakanath added.

BS Reporter in Chennai/Bangalore
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