“Timekeepers to the nation” HMT Watches to wind down after 53 years

Once synonymous to watches in India “HMT” is set to be winded up in a phased manner. Burdened with losses for more than a decade, the government is set to shut down HMT Watches, which was restructured in 1999, but nothing changed for HMT.
During 2012-13, HMT reported losses of Rs 242 crore on revenues of Rs 11 crore. In contrast, Titan’s watch business reported sales of Rs 1,675 crore during the year. HMT employs 1,105, which includes 181 executives.
HMT (HMT Limited, formerly Hindustan Machine Tools Limited), a state-owned manufacturing company under the Ministry of Heavy Industries and Public Enterprises in India, was incorporated in 1953 by the Government of India as a machine tool manufacturing company, as part of the government’s attempts to shape a modern India. It is like the Ambassador, another marquee brand of the licence-permit era. Over the years diversified into watches, tractors, printing machinery, metal forming presses, die casting & plastic processing machinery, CNC systems & bearings.
HMT almost had a free run from the time when in 1961 it set up the country’s first watch manufacturing unit in Bangalore in collaboration with Citizen Watch Co. In fact, it claims many firsts to its credit — the automatic day-date watch to the first Braille and quartz watches. HMT’s ad punch line depicted it as “timekeepers to the nation”.
But it was the quartz watches that turn out to be its downfall along with the entrance of numerous new players in the 1980s, who brought in fresher designs and more modern production methods. HMT is said to have been faltered by slow decision-making, frequently linked with PSUs. As a consequence, numerous efforts to improve the company’s performance including capital infusion didn’t work. During UPA government’s term, HMT Watches was referred to the Board for Reconstruction of Public Sector Enterprises, which suggested revitalization. While the UPA desisted from resolving on the matter, the BJP government decided to go ahead with a hard choice.

Month: Current Affairs - September, 2014