Investments in the Indian drone market reached $50 million in FY23, tripling the previous year’s investment. Both start-ups and established companies are vying for a position in this growing sector.
It has been a year since the Government announced the ‘Kisan Drone Yatra’, and followed it up with a separate production-linked incentive (PLI) scheme for drone manufacturing. Today, these measures are seeing drone companies, small and large alike, accept orders totaling to thousands of crores of rupees, while they forecast of manifold revenue growth.
At Garuda Aerospace in Chennai, a new batch of drones is ready to be shipped out. The start-up clocked Rs 50 crore in revenue from drone sales and services in FY-23, but is now prepping to service an order book involving 8,000 drones worth Rs 323 crore. Incidentally, this is only from Kisan Drone Yatra orders.
In February, Garuda secured Series-A funding totaling to 22 million dollars — the largest-ever for a drone start-up. These shipments, the start-up says, could now catapult its revenues into similarly unchartered territory.
“We are looking at a very progressive and conservative target of Rs 450 crore to Rs 500 crore next year, because we already have 320 crores of drone sales waiting to be realised,” said Agnishwar Jayaprakash, Founder and CEO, Garuda Aerospace.
Experts estimate that the farm sector alone could order drones worth 8,800 crore rupees in FY-24. Orders from Defence, Big Energy, Shipping and Steel companies could account for orders worth 16,000 crore rupees.
That has drone companies — and their investors — wanting to flexing their muscle. “I’m being very conservative when I say we will be able to tap the market and realise about Rs 2,000 to Rs 2,500 crore in the next 20 months’ time provided we have sufficient number of service providers,” Agnishwar added.
The Indian drone market has attracted investments of close to $50 million in FY23, which in itself is three-times the investments that came in over the previous year. It’s not just start-ups who are gunning for a place in the pecking order of this sector, but established companies as well.
The opportunity, these companies say, lies across the board — from operating drones for agriculture, to manufacturing applications, to making them for the armed forces — companies expect the market for drone procurement and drones as a service to multiply many times over, and they want to ride that slipstream.
In Hyderabad, security and surveillance firm, Magellanic Cloud or MCloud, has made a foray into drone-manufacturing. After executing drone service orders for energy and manufacturing majors, the company is now targeting Rs 2,500 crore in FY-24 revenues from the sale of its drones.
To achieve these targets, MCloud recently acquired 70 percent stake in Bengaluru-based drone-maker Scandron, which has enhanced its production output to 200 drones per month. MCloud says this isn’t enough, and is looking for land parcels in Hyderabad or Bengaluru to expand operations.
“The manufacturing capacity has to be drastically changed to scale. Right now, we should be able to manufacture 200 drones in a month’s time,” said Joseph Thumma, CEO, Magellanic Cloud, “We need at least 10 acres of area because of the flying testing we need to have, and if we have to scale to deliver 1,000 of drones within a month.”
Meanwhile, Mumbai-based Idea Forge is readying for a bumper IPO as it looks to deliver high-altitude drones to the armed forces. In Chennai, IIT-incubated ePlane is scaling up its production after receiving its DOA approval from the DGCA. Drone-makers are taking to the skies, and by the looks of it, they are set to make money while they’re at it.