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The Indian drone industry leader, ideaForge Technologies, faced a significant setback in the first quarter of Fiscal Year 2025, with its shares plummeting nearly 14% in early morning trade, reaching ₹740 apiece. This sharp decline was a direct consequence of the company's disappointing financial performance for the quarter ending in June, which significantly impacted investor sentiment.
The company's financial report painted a bleak picture, revealing declines in both revenue and profit. Revenue from operations dropped by 11.2% year-over-year to ₹86 crore, while EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) plummeted by 73.6% to ₹8.4 crore. Profit after tax stood at a mere ₹1.17 crore, marking a staggering 93.8% decrease compared to the ₹18.87 crore reported in the same period last year.
This weak performance in the June quarter was attributed to a significant surge in expenses, particularly for raw materials. Expenditures on raw materials skyrocketed by a staggering 321% year-over-year, reaching ₹56.1 crore in Q1 FY25. This dramatic increase, while indicative of the company's business development initiatives, severely impacted profitability. However, ideaForge highlighted several strategic initiatives in its Q1 FY25 investor presentation, showcasing its commitment to innovation and growth.
The company revealed it is currently prototyping a fog penetration radar in collaboration with space tech startup GalaxEye, demonstrating its foray into advanced surveillance technologies. Furthermore, ideaForge aims to develop exclusive surveillance capabilities and accelerate the expansion of its drone-as-a-service (DaaS) and middle-mile logistics development in partnership with TechEagle. This strategic alliance is poised to enhance its service offerings and expand its reach in the burgeoning logistics sector.
ideaForge is also actively engaged in developing next-generation payloads equipped with onboard AI computing capabilities, signifying its commitment to harnessing the power of artificial intelligence. The company has successfully conducted high-altitude trials in the Himalayas, showcasing its technological prowess and its ability to operate in challenging environments. Flight testing and design enhancements of its tactical UAV platform are in advanced stages, further solidifying its position in the tactical drone market.
Looking ahead, ideaForge has established infrastructure for prototyping a middle-mile logistics platform and is advancing the development of its next-generation NETRA and SWITCH platforms. These initiatives are aligned with the company's commitment to delivering innovative and cutting-edge drone technology. The company's focus on research and development, combined with strategic partnerships, positions it to navigate the evolving drone landscape and capture opportunities in the rapidly growing market.
Established in 2007, ideaForge Technology is a pioneering force in the Indian Unmanned Aircraft Systems (UAS) market, holding a 50% market share in Fiscal 2021–22. Its dual-use UAV technology prowess has earned it a global ranking of 5th in the drone industry. The company's strong emphasis on innovation has led to the filing of 72 patents globally, cementing its dominance in the Indian drone market.
ideaForge boasts one of the largest operational deployments of UAVs across India, delivering mission-critical outcomes in some of the most challenging environmental and operational conditions worldwide. The company's impressive track record has contributed to the significant growth of the Indian drone industry, which is projected to expand from US$ 43 million in Fiscal 2022 to US$ 812 million by Fiscal 2027, exhibiting a CAGR of 80%. This remarkable growth is fueled by the government's supportive policies, the increasing adoption of drones across various sectors, rising domestic demand, and a surge in startups and investments.
Source: ideaForge Technologies shares tumble nearly 14% as Q1 net profit drops 94% YoY