Hilton Metal Forging Limited has entered into an interim sales agreement to supply 360,000 standard 155mm M107 empty bomb artillery shells. The contract is valued at approximately Rs.7.2 billion (bn) and will be executed under a structured delivery schedule of 15,000 units per month. The transaction marks a strategic expansion into defence manufacturing and follows the company’s prior development and supply of forged railway wheels.

Under the terms the company will execute deliveries over a 24-month period with a provision for a mutually agreed grace period. Payment terms include a rolling advance equivalent to 50 per cent of three months’ supply with monthly invoicing payable prior to dispatch and adjusted against advances, providing predictable cash flows. Estimated monthly billing is approximately Rs.300 million (mn), reinforcing near term revenue visibility.

Hilton Metal Forging’s advanced forging and machining facilities and engineering and metallurgical expertise enable production of defence grade components to stringent standards. The company has a track record of timely execution and export excellence, which supports its ability to meet large scale orders and maintain quality. The non exclusive nature of the agreement allows the company to cater to additional customers and optimise capacity utilisation.

This interim sales agreement represents a significant inflection point as the company broadens into high value technology driven engineering solutions and enhances its order book. The contract is expected to strengthen the company’s position in the global defence supply chain and provide sustained revenue visibility while enabling optimal utilisation of manufacturing lines. The company intends to convert the interim agreement into a definitive sales agreement upon successful clearance and approval of the prototype batch and will proceed after completion of requisite formalities and receipt of advances.