Manish Kumar Jha (Manish Jha): MIDHANI is the leading DPSU in India and is involved in cutting-edge material sciences. How is MIDHANI doing in terms of growth and revenue? Could you give us an overview?

Sanjay Kumar Jha (CMD MIDHANI): Mishra Dhatu Nigam Limited (MIDHANI) was founded in 1973. Its objective was to make the materials for strategic projects. It aimed for critical applications. From that foundation, the company was started with very small, modest requirements of Defence, space, and nuclear. In a couple of years, MIDHANI was meeting all the requirements.

Through persistent integration and technological advancements, MIDHANI has emerged as leader in advanced metallurgical production for supplying critical alloys and products that will have its application in strategic sectors such as Defence, Space and Energy. We have started doing exports as well.

So, this is the background. MIDHANI has the technology for making alloys of very high grade in special steel, titanium alloys, super alloys, nickel-based and cobalt bases. MIDHANI also has a very good technological base in manufacturing. Some of the critical equipment also, which are very difficult to get from the other countries. In addition to that, whatever the old legacy equipment MIDHANI is having, that also we have modernised progressively and many things have been indigenised in this country with the support of our team.

Through persistent integration and technological advancements, MIDHANI has emerged as a leader in advanced metallurgical production for supplying critical alloys and products for strategic sectors such as Defence, Space, and Energy

Coming to the different platforms today, many programmes like Tejas, LCA MK2 development, and many turbine engines are developed by the DRDO, and GTRE, along with other engine components and materials for the development of AMCA. Recently, you have seen INS Arighat has been launched in which MIDHANI has contributed immensely. And the indigenisation of many materials for the applications.

Today our revenue from the last financial year has crossed more than Rs 1,000 crores. This year, based on our order book condition and requirement, it is going to grow further by almost more than 20 per cent. So, the growth path is also identified. Growth is not only because of the core competencies but diversified products which MIDHANI has developed. Also, we have diversified in the production of railway axes. The railway has good volume. So, we have certain Technology which can serve the railway also.

Manish Jha: In terms of defence entity relating to DPSU, how much percentage of growth in terms of revenue is achieved compared to the last year?

CMD MIDHANI: Last year, our revenue growth was 23 per cent compared to FY22-23. And before that – FY21-22, FY 20-21, and FY19-20, the growth was almost flat. The growth was in the range of 4-5 per cent in that domain. However, it picked up the last year because of many initiatives taken by MIDHANI, augmenting the capacity, improving the productivity, and adopting the new technologies.

Our volume of production has gone up and it is expected that this type of requirement will come across from the globe and not just India. There is good potential for MIDHANI to grow in the future and there are several foreign companies also trying to tie in with us. Last year, our export growth was almost three times from the previous year. And this year again, I am expecting that export growth will be not less than 2-3 times. Export is also growing in the high-end application i.e. for aerospace and defence. So that part is very important for us. we are running export in the high-value items, not in the low-value items.

Last year, our export growth was almost three times the previous year, and this year again, I expect export growth will be at least 2-3 times, especially in high-value items for aerospace and defence

Manish Jha: MIDHANI is very critical to many systems, infrastructure and also platforms, which the military use. You talked about some of them like TEJAS and the futuristic Advanced Medium Combat Aircraft. I would like to understand more, where MIDHANI materials are being used. If you could talk about more systems which are critical to the 'Make in India' effort?

CMD MIDHANI: Firstly, I will talk about the space programme. If you see the entire PSLV and GSLV, the rocket motor casing is used from the MIDHANI material. In addition to that cryo, semi-cryo engines are manufactured by Liquid Propulsion Systems Centre (LPSC) technology and Godrej. All materials are made by MIDHANI. Just one engine requires almost 13 to 14 varieties of grades. In different grades, you have 30 to 40 different varieties of products. We are making one alloy, that alloy will make the flats also, will make rounds, and will make the wire also. So diversified products are there. This is a very complex requirement of the materials that we are doing.

Coming to the Tejas and all other aircraft, we are not making the engines in India, but on the aircraft side, all the Titanium alloys, stainless steel, super alloys, and nickel-based alloys, are made by MIDHANI only.

In addition to that, whatever we are doing for the Arihant class of submarine requires a lot of materials. We are making many things like forgings to welder products, welding electrodes and Titanium alloys for making the valves and filters. All these products are manufactured in-house. In addition, many materials are required for the pneumatic tube transport that is a lifeline for the entire submarine or any ship. Those products are also made by MIDHANI and supplied as a part. In armour products also, like if we see the Arjuna tank, the armoured part of the tank is made by MIDHANI. So, these are some strategic equipment where we contribute.

Manish Jha: One of the most strategic demands that India is trying to achieve is to build a robust fighter jet engine which our country does not have yet. The fundamental and core of any engine is built on the material. As a leading DPSU with cutting-edge technology, where do you think MIDHANI is contributing in the building of critical components of the engine using complex material? How capable are we and when will we succeed in developing our own future generation fighter jet engine?

CMD MIDHANI: When we talk about fighter jet engines, the gas turbines are considered and gas turbines have multiple zones. The initial low-temperature zone is governed by only Titanium alloys as they are lighter and work well at moderately high temperatures being used in the initial stage. MIDHANI has technology for both Titanium and Superalloys. Based on MIDHANI material technology, KAVERI engine was developed long back. And now KAVERI has been progressing very well.

MIDHANI materials are used in all critical platforms contributing significantly to the 'Make in India' initiative by indigenising many materials

KAVERI engine's core material was done by the MIDHANI's material technology. Based on the KAVERI design, lower-capacity gas turbine engine, various missile applications and also for UAV i.e. unmanned aerial vehicles under DRDO development, material for other engines have been also totally supplied by MIDHANI. For aero engines, we have done a good amount of work. Also, we are doing the Indigenisation of 'Sukhoi engines. For Sukhoi engines all the materials which was being imported, India has decided to go for indigenisation.

Manish Jha: So, for SUKHOI all the material will be replaced by MIDHANI, so it will be 100 per cent indigenised?

CMD MIDHANI: Yes. That is what we are trying to develop and the development programme is going on.

Manish Jha: Can you improve upon the SUKHOI engine or will it follow the blueprint given through the TOTs?

CMD MIDHANI: The improvement in the design of an engine has to come from the designer. If a designer demands material of high performance, I am sure that MIDHANI can manage. Material development is not a difficult task. The only problem is single crystal blades for SUKHOI for which we have the technology established in HAL. HAL has the technology and that raw material also we are developing now. Once the raw material is developed, we will have complete control over the core and engine. An improvement over that is also possible in the future. If they decide to go for that. That part is already taken care of.

Manish Jha: We talked about the existing Technology which you have progressed well. Could you talk about the futuristic technology which you are trying to achieve using high-grade material for the AMCA? Could you talk about the breakthrough in materials, and stealth materials in MIDHANI? Where are you focussing on R&D?

CMD MIDHANI: Technology on the material side has a lot to see in the future. In many areas still, we are dependent on some old-age materials. So, replacements are possible in the future. For example, we are working under a lot of limitations today for landing gear material today. Once you can develop a new Nickel base for the landing gear, it is possible to have better performance of the landing gear. It is linked and planned with alloy development. In addition to that are Powder Component. Many components make metal powder. We are also making powder components in MIDHANI. And you can make the product using that type of component. In addition to that many new alloys are coming, Titanium based developments are underway which we are doing for AMCA.

Manish Jha: Will it be about the stealth? Is it about the design or is it about the material?

CMD MIDHANI: Both are there. Stealth requires design through the material only.

For the Sukhoi engines, all the materials that were being imported are now being indigenised by MIDHANI, aiming for 100 per cent indigenisation

Manish Jha: And that will be the most advanced fifth generation in the world, in terms of performance?

CMD MIDHANI: We are discussing that. And some work has already been done in the stealth technology in India. Now, we are trying to see how it can come to the industrial scale. And further improvements can be done. And we are also trying to collaborate with ADA, which is our designer for aircraft. So, it is possible to do that type also in India. As I said, basically the core is again single crystal blades.

So, the alloy used for developing single crystal blades, we have already started the alloy preparation other than SUKHOI. In addition to that, there are many grades which we are now replacing, giving engineering and targeting especially for AMCA, the futuristic technology. That work is going on.

We have listed many alloys of high performance that will be developed in the future. We have already got some titanium-based alloys and nickel-based alloys. The development programme is going on. Along, we are developing the requirement of properties. You know, once you are going for the development of new material, you have to go for the entire specifications and manufacturing process. Then how to qualify it, because nobody will provide the data? Also, the data is important so that development work is used in the SUKHOI aircraft. Also, we are developing technology because we are not taking any TOT for that.

Manish Jha: And how much do you spend on R&D and what is MIDHANI's annual spend? What is your R&D thrust?

CMD MIDHANI: Because in whatever we do, there are development requirements for any product. For example, aero engineering demand property requirements are very stringent, so we have to invest in our R&D. We do that throughout, while doing our equipment process itself. We are going into the lab and developing and coming back to the software. We have good facilities for that. Once developed, then will certify that. And we have a R&D team professionally working to process the knowledge. We have a team of bright metallurgical Scientists and they do this very regularly.

Manish Jha: How much percentage of your revenue is in R&D?

CMD MIDHANI: If I count the development costs also, the R&D expenditure will be almost around 10 per cent, maybe more than 10 per cent. This is quite a sizable percentage of total revenue.

And we are not considering the money which we are putting directly. During the process itself, that type of investment takes place. That part is a regular process.

MIDHANI invests significantly in R&D, with around 10 per cent of its total revenue dedicated to research and development, focusing on advanced material technology for aerospace, defence, and other strategic sectors

Manish Jha: The government is also trying to promote R&D for the private and startup ecosystem as there is a lack of spending on R&D in the country. As a leading DPSU, what do you think about it? How much should they invest in R&D. Do you also handhold the defence startups as a leading DPSU in innovating and contributing to your overall supply chain?

CMD MIDHANI: On our part, whatever product we try to outsource through the MSME, we provide complete support. R&D we do. Parallelly, R&D has to be done by the industry. The investment requirement is huge. So, it cannot be possible to generate that type of skill overnight, but my advice is that people in the private sector must allocate some funding for that. There are many R&D setups. They are willing to take up some projects. Some of the IITs can be involved and project-based funding can be done. This is possible to get the output from that. That is the one way.

Secondly, like RMS to DMRL is there, DRDO labs are also provided. Our knowledge-based technology transfer is very low cost. So, the Idea is the integration of all such facilities.

I was recently interacting with CII and SIDM and I have been told that many societies have a set of professionals that are which are willing to be attached. So, if a society can be opened by these CII Industries, it is possible to have that type of interface and knowledge can be transferred to a larger base of R&D.

So, wherever I get the opportunity to discuss, I ask, let's join hands with certain societies and institutions. We are ready to support you with the knowledge base of whatever we have. And also, I am running a centre of excellence. It is a type of training. So now, with the current policy of the government for skill development, I openly offering this to the industry, which comes to us.

Manish Jha: Exports has been one of the key targets of the Ministry of Defence. What is MIDHANI's export potential, how much are you doing and what are your views on exporting globally?

CMD MIDHANI: First of all, on the many alloys and products which are made, there are some restrictions on the exports. Certain products cannot be exported because there are some dual-use purposes. Nevertheless, despite that, there are many products where it is possible to export. Also, you need to select countries where you should collaborate, and we are trying mainly in the European countries and the US.

Our growth has been very high but of course, from a very low base. On that count, our percentage is coming to almost 200- 300 per cent. But I am sure that with this kind of potential, the future is bright. Our target is that MIDHANI should have 30 per cent of the turnover as exports, and this is possible. The market is having an appetite and we are now working with many companies that are coming for a long-term contract. I was trying to contact with a leading aerospace company and they have told me that they are willing to sign a long-term contract with MIDHANI for certain specific grades and specific alloys. These are the leading cutting-edge technology. We have given the material to them and they have already certified our material. I say, Sky is the limit. Tremendous scope for exports, you see, in the Indian industry. I think the industry should be a certified partner in the global Supply Chain in case the supply chain is hindered. We have a lot of potential in the market. MIDHANI has to augment their capacity because our capacity has to match with the environment. Their commitment is very strong. You cannot miss a target by a single day, which is the international standard. So, on that part also, we are preparing ourselves, how we meet the requirement in the given specified time?

Manish Jha: But with your Technology and your optimism, do you think the DPSU can be part of the global supply chain and also achieve the export growth target given by the government?

CMD MIDHANI: It is possible. In fact, I am saying that in this, there will be a reverse flow from India in the next 4-5 years and the next 10 years. And, do you see any technology that has been brought from any equipment. Just not! Today we have seen that France has given us 2 submarines. But they have not given any technology. Russians have given us SUKHOI but they have not given the material. So now, it is indigenisation in the fleet of LCA and the SUKHOI material, which is good for development. Towards that, there will be reverse flow from India, first on the raw material, and then, of course, equipment. We now have HAL having a joint venture and I am saying that in future many companies will come to India. Today when I discuss this with any leading Aerospace company, they say their main concern is the supply of the material. Why orders are getting delayed? We are not delivering because there is a disruption in the supply of the material. India is a tremendous opportunity. Since our industries' bases are strong. People are highly skilful. It is possible to capture.

Thank You!

 

Manish Kumar Jha is a Consulting & Contributing Defence Editor for SP's Aviation, SP's Land Forces and SP's Naval Forces and a security expert. He writes on national security, military technology, strategic affairs & policies.