HFCL to Set Up 1,000-Acre Integrated Defence Manufacturing Facility Marks a decisive step in the company’s evolution, as HFCL Limited has secured approval from the Government of Andhra Pradesh for the allotment of 1,000 acres of land to develop a large-scale defence complex. Through this move, the company plans to manufacture artillery ammunition shells, electronic fuzes, multi-mode hand grenades, and other critical defence products, as outlined in its recent earnings presentation and conference call. Consequently, HFCL signals a clear intent to deepen its presence in India’s defence manufacturing ecosystem.
Traditionally, HFCL built its reputation as a telecom and optical fiber manufacturing company. However, this development reflects a strategic shift toward integrated defence manufacturing, as management positions the new facility as a cornerstone of the company’s long-term defence strategy. Moreover, HFCL aims to strengthen indigenous capabilities in high-impact military technologies while steadily reducing reliance on imports. As a result, the company aligns itself more closely with national priorities in defence self-reliance.
During the Q2 FY26 earnings call, HFCL’s management emphasized that global geopolitical tensions and accelerating defence modernisation programs have significantly increased demand for domestically manufactured defence equipment. At the same time, global inventories of key components, including ammunition and electronic fuzes, have declined sharply. Therefore, Indian manufacturers with proven technical capabilities now face a timely opportunity. In this context, HFCL confirmed that its electronic fuzes have entered the final stages of trials, and the company expects completion shortly. Once approvals are secured, HFCL plans to move swiftly toward large-scale production.
Meanwhile, the upcoming Andhra Pradesh facility will complement HFCL’s existing defence operations, particularly its Hosur unit. The Hosur facility currently produces thermal weapon sights and other defence electronics. By expanding into ammunition and explosive components, HFCL aims to achieve greater operational scale. As a result, the company also expects stronger vertical integration. Furthermore, HFCL plans to consolidate electronics, systems, and ammunition manufacturing under a single platform. This consolidation is expected to improve efficiency and execution.
In addition, HFCL continues to expand its defence product portfolio beyond communications equipment. The company is developing drone detection radars alongside its electronic fuze program. It is also working on ground and coastal surveillance systems. At the same time, HFCL has participated in multiple defence tenders. Moreover, the company collaborates closely with government agencies, including DRDO, for testing and validation. Through these efforts, HFCL steadily builds credibility across multiple defence domains.
From a financial perspective, management has outlined ambitious growth expectations for the defence segment. HFCL projects defence revenues exceeding ₹200 crore in the near term. Over subsequent years, revenues could cross ₹500 crore annually as new products come online. Additionally, new manufacturing facilities are expected to support this growth. Although the company has not issued formal output guidance for the Andhra Pradesh complex, it views the project as a long-term investment. Importantly, the initiative aligns closely with India’s defence manufacturing and self-reliance goals.
Ultimately, HFCL to Set Up 1,000-Acre Defence Manufacturing Facility underscores a broader transformation underway at the company. By committing to a capital-intensive, large-scale platform that integrates electronics, ammunition, and systems manufacturing, HFCL joins a limited group of Indian firms pursuing end-to-end defence capabilities. Over time, this strategic leap could significantly reshape HFCL’s business profile and growth trajectory.
