Subscribe to IdeaForge Ltd: Motilal Oswal

Motilal Oswal IPO report on IdeaForge Ltd

Largest Drone manufacturer with 50% market share in India: IdeaForge Ltd (IFL), a pioneer in Drone manufacturing in India with diversified product portfolio, enjoys market share of 50% as of FY22. It has 41 patent applications, with 20 filed internationally and 21 filed in India, as on June 2023. IFL ranked 7 th globally in the dual-use category (civil/ defence) drone manufacturers, as per Drone Industry Insights report, Dec 2022. Global Drone market to grow at 20% CAGR; regulatory tailwinds in domestic market: Global Drone market is expected to grow at 20% CAGR over CY22-30 to reach ~USD91bn by CY30 (as per Lattice Report). It is rapidly expanding into various business segments like Enterprise, Logistics, Consumer and Passenger apart from Defence which would reduce latter’s share to 25% from 48% in CY22. While enterprise share would be maintained at >30%, logistics is expected to expand in a big way and contribute 36% share (<1% currently). Even domestic market is gaining traction and is expected to grow by 18x over FY22-27 to USD812mn. Ban on imports, government's industry friendly policies and push for Make in India is driving significant investments.

Valuation and Outlook

Hence we recommend Subscribe. Further given the current buoyant market and high interest for defence stocks, the issue could see listing gains as well.