Union government on 11 September 2014 decided to wind up HMT Watches in a phased manner. HMT Watches is a wholly owned subsidiary of HMT limited.
The Board for Reconstruction of Public Sector Enterprises (BRPSE) recommended closing the unit as it has been incurring losses since 2000.
The company’s net loss rose to 242.47 crore rupees in 2012-13 from 224.04 crore rupees in 2011-12.
At the end of March 2012, it also had government loan, including budgetary support for salary and statutory dues which amounts to 694.52 crore rupees.
As on March 31, 2013, the company had 1105 employees.
In 2000, HMT Watch Business group was restructured as HMT Watches Ltd. However, the company started making losses soon after, following which a revival plan was mooted and approved by the BRPSE in 2006.
With the Finance Ministry and Planning Commission not supporting the proposal, the government had asked the company to get the plan vetted by a consultant.
According to the Directors’ Report of HMT Ltd, the watch company could not show significant improvement in performance in 2012-13 due to factors like paucity of working capital, erosion of trade channel and high cost of borrowings.
The first manufacturing Unit was set up at Bangalore in 1961 in collaboration with Japan’s Citizen Watch.
In 1972, HMT expanded its watch manufacturing capacity with a set up alongside the Bangalore Factory to manufacture additional watches. In 1975, Watch factory at Bangalore was further expanded to manufacture Main Spring, Hair spring and Shock absorber components.
HMT set up additional manufacturing facilities to produce watch components sets at Tumkur and Ranibagh in the year 1978 and 1985 respectively. Watch factory at Tumkur was partially converted to manufacture Quartz Analog Watches in collaboration with M/S Citizen Watch Co, Japan. To cater to the Niche market, a specialized watch case manufacturing facility was set up at Bangalore in 1983.
HMT Watches claimed many firsts to its credit like the automatic day-date watch to the first Braille and quartz watches.