Coromandel to acquire majority stake in drone startup Dhaksha

Agricultural solution provider Coromandel International Limited is set to acquire Dhaksha, a manufacturer of petrol engine-based drones designed for agriculture spraying applications.

Coromandel is acquiring an additional 32.68% stake in Dhaksha for a cash consideration of Rs 204 crore via its wholly owned subsidiary: Coromandel Technology Limited (CTL), according to the filings.

The acquisition is likely to be completed during the second quarter of FY24.

Post completion of the above transactions, Coromandel will hold 51.02% stakes in Dhaksha. In September 2022, Coromandel acquired 18.34% in Daksha through its investment firm Dare Ventures Limited which the company is going to transfer at cost to Coromandel Technology Limited.

The acquisition will value the drone platform Dhaksha at around Rs 624 crore or $76 million. Significantly, both Coromandel Technology Limited and Dare Venture are investment arms of Coromandel International.

Founded in 2019, Dhaksha provides a range of Unmanned Aerial Systems (UAS) technology solutions across agriculture, defence, surveillance and enterprise applications. It also offers remote pilot training services and has trained over 950 pilots to date.

It claims to be the only player in the country to receive type certificates from DGCA for three drone models in medium and small categories for agriculture and surveillance applications. Besides operating in the electric drone segment, it is the only player in India to offer type certified petrol engine-based Hybrid Agri Drones.

Dhaksha was selected as part of the Production-Linked Incentive (PLI) scheme, which aims to boost the manufacturing of drones and drone components in India. The turnover of Dhaksha for FY22 was Rs 4.52 crore.

This investment allows Coromandel to establish a presence in the rapidly expanding UAS segment, which is projected to witness significant growth and reach a global market size of $90 billion by 2030. This move follows Coromandel's recent entry into the Specialty Chemicals and Contract Manufacturing (CDMO) sectors.

Despite the so-called funding winter, drone startups are going through their heyday. Recently, ideaForge, one of the top funded startups in this space, was listed on the stock exchange. Aereo (formerly Aarav Unmanned Systems) and Omnipresent Robot and Garuda Aerospace are also considering going IPO in the next couple of years. Backed by former Indian cricket team captain Mahendra Singh Dhoni, Garuda raised $22 million in a Series A round in February this year. The company also turned profitable in FY22.