Zen Technologies Ltd. is well positioned to sustain a 50% compound annual growth rate for the next three years till FY28, powered by a robust order book.
Ashok Atluri, chairman and managing director of Zen Technologies, expects a topline of Rs 1,350 crore in fiscal 2026, with an increase to Rs 3,000 crore by fiscal 2028.
The anti-drone systems and combat training solutions provider’s order book stood at nearly Rs 1,160 crore in the June quarter. The company is planning to execute orders worth Rs 650 crore in the current financial year, which will give a boost to its CAGR.
“That will take us to Rs 900 crore turnover during the year. The order expectation is that towards the end of the third and fourth quarters, we will be getting substantial orders that will take us closer to our goal of 50% growth rate of about Rs 1,350 crore turnover next year,” Atluri told NDTV Profit.
Atluri was confident that a 50% CAGR for the next three years is sustainable due to drones and anti-drone systems becoming increasingly popular with defence forces. “We are at the sweet spot for the two biggest requirements for the armed systems worldwide – training simulators and anti drone systems,” he said.
“Ebitda margin conservatively should stay at 35% and PAT at 25% going into the future all the way up to FY28,” Atluri added.
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According to the top executive of the company, the simulators business is expected to contribute 60% revenue by FY28. Margins are also expected to improve in the segment.
“In the anti-drone space, margins have been in the range of 30% or so, compared to 40% for simulators,” Atluri said.
He also shared plans on exports, saying that the current export order book of Rs 400 crore will increase. He expected the export revenue to be around 40-45%, going ahead.
Atluri noted that there will be minimal capex requirement to get the orders executed, as Zen Technologies outsources its manufacturing. “Actual investment for plants and machines has not been much. But, because the final integration is done at our premises and we are building additional space to accommodate this facility, a capex requirement of less than Rs 50 crore will be there.”
The company recently raised Rs 1,000 crore funds through its first ever Qualified Institutional Placement. The company will focus on inorganic growth acquisition, which concerns simulation and anti-drone systems. The company also plans to deploy some of the funds towards working capital needs and general purposes like deeper research and development of products.
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