MC EXCLUSIVE HFCL eyes 'massive' opportunity in defence sector, bets big on new Andhra manufacturing complex

HFCL

HFCL sees a “massive” opportunity in the defence and aerospace segments and its upcoming facility in Andhra Pradesh will significantly strengthen its position, Manish Gangey, executive president of product strategy, has said.

The home-grown telecom equipment manufacturer recently acquired a 1,000-acre land parcel in the southern state to develop the facility, which will produce artillery shells, multimodal grenades and other military ammunition.

“We see massive potential in the defence and aerospace sectors. Our newly acquired land in Andhra Pradesh will house a large-scale manufacturing and testing facility for defence ammunition products,” Gangey said.

The timing is ideal, as India intensifies its push for indigenisation in defence manufacturing.

“Most defence supplies are now expected to be produced domestically. With strong government support, we believe we’re well-positioned to capitalise on this opportunity,” he said.

Portfolio expansion

Beyond communications technology, HFCL also plans to diversify into non-communication infrastructure to expand its portfolio.

HFCL’s communication infrastructure recently played a key role in a major defence operation, enabling seamless inter-command coordination, Gangey said in an apparent reference to Operation Sindoor. “That was part of one of our projects that we successfully executed,” he said.

Watch Full Interview: From BharatNet to Global Markets: HFCL’s Vision for Telecom & Defence

HFCL expects its defence revenues to cross Rs 500 crore next year, up from over Rs 200 crore this year, driven by new product launches and major projects, it said during the recent Q2 earnings call.

The company has completed a large defence network and will soon begin an annual maintenance contract worth around Rs 170 crore, already approved by the army.

Its electronic fuses are undergoing final testing and are expected to see strong demand from both domestic and international markets.

Electronic fuses are advanced devices used in artillery munitions like shells fired from howitzers and mortars to control their detonation.

HFCL designed radars are also being increasingly used in border defence and protecting critical infrastructure.

HFCL plans to present its radar technology to the home ministry, even as the navy tests the systems for maritime surveillance. Its software-enabled drone detection radar systems would be ready soon.

The company has also set its sights on the fast-growing data centre market, particularly in data centre switching solutions.

“We already started our push into the data centre market…we're into active conversations with some of these customers,” Gangey said.

HFCL has come up with the “passive infrastructure” needed for a data centre. The next step would be to look at the active infrastructure side, “which we are very well poised for from the perspective of having built the products for the telco market. Data centre becomes a logical place for us to go”, he said.

Overseas fibre expansion

HFCL is aims to expand its international business by partnering with major telecom operators worldwide to support fibre rollouts.

“We will be out there in front of a lot of major telcos outside of India, and with a story of provenness. A lot of that will start to show up as we go along. BharatNet is a showcase project, not just for us, but for the country as a whole,” he said.

There are several markets which have similar characteristics as India. “We should be able to go and replicate the success over there,” he said.

HFCL is exploring opportunities in the US and European markets, leveraging its expertise in large-scale fibre deployments and network integration.

“For any systems or IP-driven business, once you conquer your domestic market, you’re ready to stand in front of global competition,” Gangey said. “We’ve done it in one of the toughest geographies, and that gives us credibility.”

The company’s confidence is rooted in its domestic success, especially its role in the BharatNet project, the world's largest rural telecommunications infrastructure projects that aims to provide high-speed broadband connectivity to around 625,000 villages.

“BharatNet is a showcase project — not just for us, but for the country,” Gangey said.

“If we can build and manage a network of this size and complexity in India, we can replicate this success in other markets with similar challenges.”

‘This is India’s moment’

Having proven itself in domestic networks, HFCL should now go big on the global telecom scene. “This is India’s moment — and we’re ready to seize it,” he said.

Over the past decade, India has transitioned from being a consumer of telecom technology to becoming a creator and exporter.

Gangey described this as “the right moment” for India to assert its leadership on the global technology stage.

“When 4G was coming around, we were really a consumer of technology,” he said. “But with 5G, the story changed. Indian companies — from operators to equipment manufacturers — began creating value locally by developing products and services within the country.”

According to Gangey, this transformation was the result of years of investment, learning, and capacity building.

As global discussions on 6G standards gain momentum, India is well-placed to play a leading role.

“We have learned the lessons in the last 10 years — what to build, what not to build, and where the skill gaps are. When it comes to 6G, we should be a very strong player internationally,” he said.