India's Top Drone Manufacturer Eyes US Expansion With $69M IPO

India’s leading drone manufacturer, IdeaForge Technology, is gearing up to expand its presence in international markets, particularly the US, with the launch of its Initial Public Offering (IPO), Benzinga India reports.

Expansion into the US

IdeaForge is keen on unlocking the US market, seeing strong potential in serving certain applications there. The company believes that geopolitical tensions between the U.S. and China might provide opportunities for its expansion, especially when teamed up with credible local partners. The company also has a presence in Oman and plans to expand into Nepal, Bangladesh, and Vietnam.

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IPO Details

The IPO of IdeaForge will be open for subscription from June 26 to June 29, with the price band set at ₹638 to ₹672 per share. The company plans to raise approximately ₹570 crore ($69.4 million) through the IPO, aiming for a post-issue implied market cap of up to ₹2,800 crore ($341 million). The company’s debt is expected to decrease to ₹35 crore ($4.2 million) after the fund utilization.

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Diversification Strategy

The company’s executives have outlined a three-pronged approach to diversify their revenue stream. This includes a civil-defense split, international expansion, and the development of a services business. Despite the defense sector accounting for approximately 70% of its revenue, IdeaForge is making significant efforts to expand into civil applications of drones, such as mapping in agriculture, roads, power lines, and other infrastructure.

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About IdeaForge’s Business

IdeaForge’s competitive edge lies in its patents across the entire stack of hardware and software involved in making drones. The company’s proprietary tech and patents not only create a barrier to entry but also help reduce costs for the company. However, the company’s profit after tax fell to ₹32 crore ($3.9 million) in FY23 from ₹44 crore ($5.3 million) a year ago, mostly due to a large number of employee stock options being vested in the most recent financial year.

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