Will Adani succeed in "battle" plan?

Adani Group puts in last-minute bid for Indian Navy's Rs 45,000-crore submarine project

Economic Times (India)

12 September 2019

[NB: Rs 1 crore is 10 million rupees]

In a last-minute entry, the Adani Group submitted a bid for the Rs
45,000-crore Indian Navy submarine project, taking other contenders by
surprise for what is the largest ongoing Make-in-India initiative in the
defence sector.

The much-awaited contest was expected to be a faceoff among traditional
contenders such as Larsen and ToubroNSE 0.49 % (L&T), Mazagon Dock
Shipbuilders Ltd (MDL) and Reliance Naval and Engineering Ltd, all of
which own shipyards. The Adani Group does not currently own an active
shipyard, which is why the bid has come as a surprise.

Those familiar with the details told ET that the Gujarat-based group could
float a special purpose vehicle (SPV) with state-owned Hindustan Shipyard
(HSL), which has experience in submarine repairs and overhauls.

Interestingly, HSL has also put in a standalone bid.

The Adani Group, which did not respond to queries, is now a contender for
all three mega defence acquisition plans under the government’s strategic
partnership model – for future fighter jets, naval helicopters and
conventional submarines.

Others that submitted bids for the submarine programme are L&T, MDL and
Reliance Naval.

The contract, under which an Indian shipyard will be chosen to manufacture
six conventional submarines in collaboration with a foreign partner, is in
its initial stages. Over the next two months, the defence ministry will
scrutinise the bids to shortlist qualified Indian contenders.

The formal tender for the contract — after foreign partners from Russia,
France, Germany, Spain and Sweden are selected as part of a parallel
process — is expected by the end of the year. At the earliest, the
submarine contract can be awarded to the winning contender after two
years.

The single biggest shipbuilding plan under the strategic partnership model
is expected to see stateowned MDL as the frontrunner, given its experience
in building the Shishumar class of submarines as well as the current
production line for the Kalvari (Scorpene) class of boats.

As reported by ET, the Adani Group has ambitious plans in defence, with
its acquisition late last year of Bengaluru-based Alpha Design
Technologies Pvt Ltd that has a strong order book and tieups with big
Russian and Israeli companies.

The acquisition has enabled Adani to get involved in the specialised
defence and space business. Its product list now ranges from drones to
helicopters and simulators. It’s also one of the major suppliers for the
indigenous Light Combat Aircraft (LCA) programme.

The acquisition placed Adani Defence and Aerospace in the big league that
includes the Tata Group, Mahindra & Mahindra, Reliance Defence and L&T,
which are vying for large Make-in-India projects under the strategic
partnership scheme. Adani unveiled a manufacturing facility in Hyderabad
last year to make Hermes 900 drones in collaboration with Israel’s Elbit
Systems.