Interview with Shekhar Mital, CMD, Goa Shipyard Ltd.
: GSL has recorded exceptional financial results for the last financial year. Can you elaborate on that?
Backed by timely delivery of quality products, GSL has been recorded phenomenal growth year-on-year since last four years. Four years ago, company was facing a really hard time but now that phase is over and GSL has recorded PBT of Rs 305 crore (unaudited) for FY 2017-18, a jump of five times. Similarly for VoP, we have recorded ever highest VoP of GSL at Rs 1370 crore (unaudited) for FY 2017-18, which is a three times increase in the last four years. This becomes particularly more impressive when growth of 30% achieved in the last 4 years is compared with other shipyards operating under similar ecosystems. These excellent financial results are a direct manifestation of new benchmarks established on reduced ‘build periods’, thereby reducing overheads significantly.
: What are the key elements responsible for the exponential growth of GSL in the last few years?
The excellent performance in exports is driven by dependable and quality products with international acclaim. Because of our high quality products, we have been able to make significant inroads into global market with export of diverse vessels to Indian Ocean Region (IOR) countries. We have delivered 2 OPVs to Sri Lanka, 11 FIBs and 2 FPVs to Mauritius, and a Damage Control Simulator to Myanmar. The second and last vessel of the Sri Lankan OPV project was delivered on 22 March 2018, 25 days ahead of schedule. These OPVs are the biggest warships to be exported from India and largest in the Sri Lankan Fleet. Based on export performance, the Shipyard was given RM’s award for ‘Best performing in export amongst all DPSUs’.
: How has GSL managed to deliver all projects ahead of contractual delivery schedule?
If you take a scan of India’s shipbuilding industry, except for GSL you will hardly find any shipbuilding project which is not struggling with time and cost overruns. In such a scenario, GSL has stood out to deliver 24 ships/projects in the last four years, all ahead of contractual delivery schedule. These platforms amount to a 32000 gross tonnage, highest amongst Indian shipyards. Another major highlight of our achievement has been the reduction in ‘Build Period’of OPVs from 67 months to OPVs delivered prior 2014 to 36 months for the recently completed six Coast Guard OPV project. This has substantially helped in controlling the construction schedule, besides keeping the cost under control.
These outstanding outcomes are the result of hard work, toil and strategic alignment across various departments of the company. The slew of measures undertaken for this turnaround include strategic realignment of priorities, strict cost control measures, stringent monitoring mechanisms, seamless coordination amongst various stake holders, accountability of personnel, on the spot decisions, fast tracked approvals and effective supply chain management. This, of course comes only with sound understanding of technical and financial issues required in running shipyard efficiently.
: GSL has also been spearheading the ‘Make In India’ mission with lot of initiatives. Can you shed some light on the same?
One of the major ‘ Make in India’ initiatives of GSL is major import substitute project for manufacturing of 12 MCMVs for which the construction should commence by 2019. The infrastructure for the MCMV project is in final stages and post completion, GSL would have the only facility in South Asia to construct high end MCMVs with advanced FRP hull. Another major import substitute project is construction of two Advanced Missile Frigates 1135.6 under collaboration with Russia. GSL has also collaborated with Griffon Hover works Limited (GHL), UK, towards inflicting indigenous production of hovercraft in India. GSL has already developed expertise and erected requisite infrastructure for the indigenous construction of hovercraft at GSL and presently pursuing vigorously with potential customers.
Ship design is one of the thrust areas of GSL, where 100% self-reliance has been achieved, which otherwise would require considerable FE expenditure towards bought out designs from foreign shipyards/ designers. We design and build one of the best patrol vessels in the world in terms of quality, fuel efficiency, ergonomic design and optimum cost. We also have designs of few future vessels such as ASW Shallow Water Crafts, Corvettes, Mini frigates, Training Ships, Interceptor crafts, etc. in our inventory. We are first Indian shipyard to have an in-house R&D unit recognised by the Department of Scientific and Industrial Research (DSIR), Government of India in 2014.
Another major initiative was adoption of ‘Purchase Preference Policy’ in favour of indigenous equipment manufacturers in 2014. I am happy to state that the Central Government has recently promulgated a similar purchase preference policy. Further, we have identified various equipment and systems, which were imported till date, for replacement with locally produced products. Various products such as gearbox, heli grid, steering and stabiliser, water proof doors, steel plates etc. are being sourced locally for new projects. Increased indigenous content onboard ships constructed at GSL have been and will be the focus areas of GSL in the times to come. Having touched 70% indigenous content on GSL OPVs, I am hopeful that day is not far when we will have 100% indigenous content.