Drone Maker ideaForge Expands ESOP Pool Amid Profit Decline

IdeaForge Allocates 1,678 Equity Shares to Employees

ideaForge, a leading Indian drone manufacturer, has expanded its employee stock option plan (ESOP) pool by allocating 1,678 equity shares to its employees. The company announced the allotment in a recent exchange filing, stating that the executive committee of the board approved the move on June 14, 2024, according to Inc 42.

The newly allotted shares, each with a face value of ₹10, are worth approximately ₹13 lakh ($1,580) based on the stock’s closing price on Friday. This allocation brings the total number of issued shares from 4,28,88,323 to 4,28,90,000.

ESOP Expansion Amidst Profit Decline

ideaForge’s decision to expand its ESOP pool comes at a time when the company reported a more than 30% decline in its consolidated profit after tax (PAT) for the March quarter (Q4) of the financial year 2023-24 (FY24). The PAT dropped to ₹10.3 crore ($1.25 million) from ₹14.8 crore ($1.8 million) in the December quarter, partially due to increased spending on inventories and employee benefits.

Despite the profit decline, ideaForge’s operating revenue saw a 12.5% quarter-on-quarter (QoQ) increase to ₹102.3 crore ($12.4 million) in Q4 FY24, marking a 164% jump from the ₹38.7 crore ($4.7 million) reported in Q4 FY23.

ideaForge’s Drone Solutions and Market Presence

Founded in 2007, ideaForge is a drone manufacturing startup that specializes in UAV systems for inspection, surveillance, and mapping. The company’s offerings have applications in various sectors, including defense, homeland security, mining, construction, agriculture, energy, and utilities.

ideaForge made its stock market debut in June last year with a premium of 94% to its IPO price. The IPO comprised an offer for sale (OFS) component of 48.7 lakh shares and a fresh issue of shares worth ₹240 crore ($29.2 million).

DroneXL’s Take

The expansion of ideaForge’s ESOP pool demonstrates the company’s commitment to rewarding its employees and attracting top talent in the rapidly growing drone industry. Despite the recent profit decline, ideaForge’s strong operating revenue growth and its position as a leading drone manufacturer in India indicate the company’s potential for long-term success.

As the spacetech sector continues to thrive in India, with 100 spacetech startups registering with the Indian Space Research Organisation (ISRO) last year and the sector garnering $233 million in funding between 2014 and July 2023, ideaForge is well-positioned to capitalize on the market opportunity. With the spacetech sector estimated to reach a market size of $77 billion by 2030, ideaForge’s innovative drone solutions and strong market presence will likely play a crucial role in the company’s future growth and success.