HEC Faces Closure Threat Amidst Mounting Debts and Production Woes
Heavy Engineering Corporation (HEC) is grappling with its worst financial crisis, with 18 months of unpaid salaries to employees and escalating liabilities, including a massive electricity bill and poor production output. This situation poses a severe threat to the company’s future.
RANCHI – The Heavy Engineering Corporation (HEC) is facing an unprecedented financial crisis, edging closer to closure due to mounting liabilities and stagnating production.
Employees are bearing the brunt of the crisis, with 18 months’ worth of salaries pending.
The company’s financial liabilities have skyrocketed, with an outstanding electricity bill of Rs 140 crore.
HEC’s current financial year (2023-24) production target was set at Rs 216 crore, yet only Rs 25 crore has been achieved between April and December.
This shortfall is evident across all three plants: FFP, HMBP, and HMTP, with production targets massively unmet.
The situation is exacerbated by ongoing operational costs, such as a monthly water bill of Rs 4.57 lakh, leading to an accumulated water charge debt exceeding Rs 15 crore.
Despite reduced production, the monthly electricity bill remains around Rs 80 lakh, swelling to Rs 2.5 crore with late charges.
Adding to the woes, the status of contract laborers remains uncertain.
Laldev Singh, Vice President of Hatiya Kamgar Union, highlighted that contract workers have been operating without a contractor since September 2023, leading to issues with salary slips and payment.
The confusion extends to the management’s claims regarding the reinstatement of contractors for September and October, raising questions about the payment of GST owed by the contractor and the future of the contract workers.
The demand for clarity from the management is growing as HEC struggles to navigate through its worst phase since inception.
