Zen Technologies up 3% on Rs 160-crore order from government

Zen Tech creates, develops, and produces sensor- and simulator-based defence training systems for security forces. (Image: Zen tech website)

Zen Technologies Limited stock was trading more than three percent higher on July 7 morning after the developer of defence training and weapon simulators bagged a Rs 160 crore order from the government, the second such contract in the last four months.

The deal is part of the government's Indigenous Design and Development (IDDM) plan, which calls for Indian intellectual property and more than 60 percent home-made content, said the company in a regulatory filing.

In March, Zen Tech received a Rs 127-crore order from the armed forces.

Also read: Zen Tech trades 8% up after Q4 profit jumps 510%

The government’s push for indigenous defence equipment and technology has perked up the sector. The company reported a 510 percent on-year jump in the fourth quarter consolidated net profit to Rs 20 crore. Its net profit stood at Rs 9 crore in the previous quarter.

Zen Tech's total revenue increased 215 percent year on year (YoY) to Rs 96 crore.

At 9.07 am, the stock was trading at  Rs 432.60 on the National Stock Exchange, up 3.10 percent from the previous close.

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Earlier this month, Paras Defence & Space Technologies Limited  received the contract for the procurement of 400 units of agri-drones for IFFCO Nano Fertilisers, including two years annual maintenance contract (AMC), totaling around Rs 42.4 crore

Mazagon Dock, the company that manufactures warships and submarines for the Indian Navy, also signed a contract worth Rs 2,725 with the Ministry of Defence. The contract is for restoring INS Shankush, a submarine of the sub-surface killer (SSK) class.

Also read: Zen Technologies bags Rs 127 crore order from armed forces

Market investors are playing on the emerging defence bet via thematic funds. The Nifty India Defence Price Return Index (PRI) generated a compounded annual growth of 20 percent over the past five years, while the Nifty 50 PRI and the Nifty Midcap 150 PRI clocked 11.2 and 12.7 percent, respectively.

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