The Initial Public Offer (IPO) of India's largest drone maker, ideaForge Technology Ltd, opened for subscription today, i.e. Monday, June 26 and will close on June 29. The company had filed draft papers with markets regulator SEBI in February this year.

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ideaForge is a Mumbai-based, vertically integrated firm, which designs and manufactures drones for mapping, security and surveillance application. In the same industry, Droneacharya Aerial Innovations made a stellar debut on the BSE SME platform in December 2022.

ideaForge is backed by the likes of Qualcomm, Infosys and Florintree Capital Partners, co-established by former Blackstone executive Mathew Cyriac.

The company is the largest drone manufacturer in India as of September 30, 2022, the DRHP states. ideaForge had the largest operational deployment of UAVs across India given its early establishment in 2007 compared to its peers and the revenue market share that the company holds.

ideaForge has a market capitalisation of Rs 28,002 million, as compared to Rs 60,040 million for MTAR Tech, and Rs 102,010 million for Data Patterns India Ltd.

ideaForge stands to benefit from the ban on the import of completely built-up (CBU), semi-knocked-down (SKD) or completely-knocked-down (CKD) drones. ideaForge plans to capitalise on programmes like the Atmanirbhar Bharat and lessen its dependence on imports, hence lowering its import expenditure.

ideaForge has a diversified product portfolio of UAVs built for multiple use cases and has one of the industry’s leading product portfolios for civil and defence applications (dual use).

The company's revenue as well as EBITDA margin have grown multifold in FY22 as viewed below. Also, the operating margin is at comfortable levels and considerably higher than its peers.

The IPO will include a fresh issuance of shares worth Rs 240 crore and an offer for sale of 48.69 lakh equity shares by promoters and investors. From the upper price band, the firm will raise around Rs 567 crore. The company aims to utilise net proceeds from the fresh issue for repaying debts, working capital, and investment in product development, besides general corporate purposes.

The allotment will be made on July 4, refunds on July 5 and the listing of shares on exchanges will be on July 7. On the upper price band, the firm is valued at Rs 2,800 crore. Currently, promoters hold a 33.97 percent stake in the company and the rest of the shareholding is by public shareholders.

Florintree Enterprise LLP and Celesta Capital II Mauritius are the biggest shareholders in the company, holding 11.85 percent and 11.42 percent stake, respectively. The fresh issue size has been reduced to Rs 240 crore from Rs 300 crore earlier after ideaForge raised Rs 60 crore by issuing 8.92 lakh shares in a pre-IPO placement.

The founders of ideaForge, in 2004 (in IIT, Mumbai) built one of the first quadrotor drones (in India) to enter a college fest. Following this, in 2009, ideaForge demonstrated Netra UAV at DEFEXPO, exhibiting the product launch of India’s first quadcopter drone at DEFEXPO.

In addition, in 2009, ideaForge developed one of the world’s smallest and lightest autopilots. An early prototype of ideaForge’s VTOL UAV was featured in the Bollywood movie ‘3 Idiots’, in 2009.

First Published:Jun 21, 2023 10:47 AM IST