Anil Ambani eyes defence sector, raises cluster of 11 companies

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Anil Ambani is seeking to establish a firm grip on the defence sector, as he creates a cluster of companies and applies for licenses  to develop, manufacture military equipment ranging from UAVs and spacecraft to submarine systems.

His Reliance Defence Limited (RDL), in a quiet move followed the acquisition of Pipavav Shipyard by raising 11 new companies focused on defence – each of them targeting a potential market of at least Rs 10,000 crore.

These companies would be used as joint venture partners with foreign manufacturers looking at the ‘Make in India’ initiative or for licence production of equipment. RDL  is also looking to export defence products from India.

Anil Ambani is eyeing more than just shipbuilding and helicopter manufacturing, having applied for at least 13 new licenses to develop and produce military systems, with the hope for clearances by the end of this year.

The firm has also sought permission to manufacture spacecraft and satellites.

“The group will aim at a leadership position in the sector and is committed to deliver on time and give the best value proposition,” Rajesh Dhingra, President, Reliance Defence &Aerospace Pvt Ltd told ET.

The financial daily reported the applications show that RDL is keen on entering the core markets of land systems, unmanned aviation, defence electronics, submarine construction, production of missiles and development of engines for all platforms.

Senior executives said that the company has been getting welcome signals from global defence manufacturers that have been in talks over the past few months.

As reported by ET, Anil Ambani has been personally driving the defence business and has met the leadership of almost all major defence manufacturers around the world.

“The response from global OEMs has been exceptional and commitments received have the potential of transforming Indian defence industry in the next ten years,” Dhingra told the financial daily.

The business plan of RDL is believed to be based on the estimation that the requirement of military hardware in the next decade would exceed $250 billion.

The company has also been hiring extensively, picking up executives for its head office in Delhi as well as preparing the formal takeover of the Pipavav Shipyard.

It is also in the race for several defence contracts, including a $2 billion order for landing platform docks (LPDs) which is nearing finalisation and two helicopter manufacturing projects worth over $3 billion that are in the initial stages.

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