IdeaForge Technology, the company that manufactured the drone used in the popular Indian movie 3 Idiots, is set to launch India’s first mainboard drone company Initial Public Offering (IPO). Here are all the important details you need to know about the ambitious venture.
About IdeaForge Technology
Founded in 2007 by IIT Bombay alumni Ankit Mehta, Rahul Singh, Ashish Bhat, and Vipul Joshi, IdeaForge Technology is the first India-based organization to develop and manufacture vertical take-off and landing (VTOL) UAVs for security operations. Located in Mumbai, the company manufactures drones for India’s armed forces, police, and homeland security, as well as for industrial applications. IdeaForge has also expanded beyond India to Oman, Nigeria, and Bhutan.
Backed by Marquee Investors
In August 2022, IdeaForge Technology raised US$20 million (m) in a Series B funding round, led by Florintree, a company led by Mathew Cyriac, the former private equity co-head of Blackstone India. The round also saw participation from the company’s existing investors Celesta, Infosys, Qualcomm, and Infina, along with the Exim Bank of India.
IPO Details
The company is set to raise about ₹7.5 billion (bn) through an IPO, which may also consider an issue of shares aggregating up to ₹600 million (m). Approximately 25% of the shares in India’s largest drone manufacturer will be offered through secondary and primary share sales. The IPO will value the company at ₹30 bn. The proceeds of the proposed IPO would be used to pare debt and for working capital requirements and product development. Investment banks JM Financial and IIFL are the lead managers for the IPO, which will be launched by May 2023.
Notable Mentions of IdeaForge
According to the company’s draft red herring prospectus, IdeaForge drones were used for site monitoring in Kathmandu, Nepal, and other locations during the 2015 earthquake to aid with search and rescue activities. The drones also delivered crucial intelligence during a terrorist incident in Pampore in 2016 by revealing the precise locations of the terrorists. IdeaForge’s Ninja drones were utilized to curb theft and pilferage cases with the company’s partnership with railways to boost their surveillance operations.
Investment Takeaway
IdeaForge Technology has the largest operational deployment of indigenous UAVs across India, and its customers have completed over 300,000 flights using the company’s UAVs. The company also ranked 7th globally in the dual-use category (civil and defence) drone manufacturers as per the report published by Drone Industry Insights in December 2022. While the company has a strong presence in an emerging business, the timing of the IPO may raise certain concerns. The market is quite volatile these days, and diminishing investor appetite and volatile markets have pushed away companies from going public. It remains to be seen under what conditions the company decides to come out with its IPO, but it is expected to witness a lot of traction, just like Tata Technologies IPO and Tata Electronics IPO.
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