The company has been incurring heavy losses for quite some time. From Rs 146.13 crore in 1996-97, they went up to Rs 174.8 crore in the next fiscal, decreasing to Rs 145.8 crore in 1998-99, and further going down to Rs 36.84 crore in 1999-2000. The administrative ministry of heavy industries & public enterprises was quite hopeful for this fiscal.

However, the ministry has not given up hope though it has been scaled down drastically. So, for the next fiscal the profit target has been fixed at Rs 1.83 crore. Even as the department of disinvestment (DoD) is working a sell off plan for HCL, there are plans to diversify it into telecom-related products and services like wire in local loop (WiLL) and high-voltage XLPE variety of power cable. The company intends to make investments worth Rs 17.35 crore on its own in the next fiscal. The Government's contribution will be known only in the Budget . Last year, the budgetary support for HCL was Rs 6 crore.

According to official sources, HCL has proposed to spend Rs 6 crore on expansion of fibre optic cables, Rs 4 crore on the production of 300 km of XLPE cable, Rs 3 crore on digital microwave and WiLL, and Rs 2 crore on SDH-PDH transmission equipment. The Government has been quite patronising towards HCL. In January 1999 it came up with a package of assistance, including reservation of orders by DOT and MTNL, along with 50 per cent advance.