ideaForge Returns to Profit in Q2 FY27 as Revenue Surges 124% to Rs 91.3 Crore

Indian drone manufacturer ideaForge Technology reported a strong financial recovery in the second quarter of FY27, supported by improved order execution and continued investment in product development. The company also made progress on new drone platforms and secured government-backed funding for its heavy-lift logistics drone project.

“Building on the steady start of the year in Q1 FY27, Q2 FY27 saw continued progress in order book execution, new product development, and preparations to capitalise on upcoming procurement opportunities,” said Ankit Mehta, Co-founder and CEO of ideaForge Technology.

A Return to Profitability

ideaForge recorded revenue from operations of Rs 91.3 crore in Q2 FY27, marking a 124% increase from the corresponding quarter last year.

Its performance was also strong during the first half of the financial year. Operating revenue for H1 FY27 rose 199% year-on-year to Rs 159.9 crore, compared with Rs 53.5 crore in H1 FY26. The growth was supported by the delivery of more than half of the company's opening order book.

The defence business remained the biggest revenue contributor, accounting for Rs 65.7 crore, or 72% of operating revenue during the quarter. The civil and enterprise segment generated the remaining Rs 25.6 crore, contributing 28% to revenue. This business benefited from mapping assignments, crowd safety monitoring solutions and subscriptions to its Drone-as-a-Service software, which enables customers to manage drone operations through cloud-based platforms.

The improved revenue performance helped ideaForge return to profitability. The company posted a profit after tax of Rs 6.5 crore in Q2 FY27, compared with a net loss of Rs 19.6 crore in the same quarter last year. Its net profit margin stood at 7.1%, reversing the negative margin of 48.1% reported in Q2 FY26.

EBITDA (earnings before interest, taxes, depreciation and amortisation) reached Rs 23.2 crore, translating into a margin of 25.4%. In the year-ago quarter, the company had reported an EBITDA loss of Rs 8 crore and a negative margin of 19.6%.

Total expenses increased 41.8% year-on-year to Rs 90.1 crore in Q2 FY27. Material costs accounted for the largest share at Rs 48.1 crore, or 53.4% of total expenses. Employee benefit expenses stood at Rs 16.6 crore, while other expenses amounted to Rs 16 crore. Depreciation and amortisation costs were Rs 14.7 crore, and finance costs came in at Rs 1 crore.

Operational Challenges and New Developments

Despite the improvement in financial performance, ideaForge continues to face operational challenges linked to global supply chain disruptions and delays in customer approvals for deliveries.

Mehta said the company had maintained its execution pace despite these difficulties. He added that ideaForge was closely tracking supply-related developments and taking steps to reduce their impact on production schedules and customer deliveries.

The company has also secured Rs 151 crore in research funding from the Technology Development Board to develop YETI, a heavy-lift logistics drone. The platform is designed to carry payloads of up to 200 kg over a distance of 200 km, with a focus on middle-mile logistics applications.

In another product development milestone, ideaForge completed field testing of its ZOLT hybrid tactical drone. The platform has a range of 100 km and can remain airborne for up to six hours. It is also designed to operate in environments affected by electronic warfare, including situations involving signal jamming, making it suitable for intelligence, surveillance and reconnaissance missions.

Separately, the company used the equity capital raised through its qualified institutional placement (QIP) to repay its outstanding debt in full.

Order Book and Working Capital Remain Key Concerns

While the company has improved its financial performance, its order book and working capital position remain important areas to watch.

ideaForge's order book stood at Rs 202.2 crore at the end of Q2 FY27, down from Rs 350.8 crore in Q3 FY26. The decline reflects the pace at which the company has executed existing orders, which has exceeded the addition of new contracts.

Working capital requirements also remain high. Inventory stood at Rs 155 crore, while trade receivables amounted to Rs 161.1 crore, indicating that a significant amount of capital continues to be tied up in operations.

Nonetheless, the business sees potential in the pipeline for defense purchases. An estimated Rs 20,000 crore worth of opportunities under the Fast Track Procurement route could provide stronger business visibility over the medium term.

As ideaForge works to convert its technology development and order execution efforts into sustained growth, its ability to manage supply constraints, secure fresh contracts and improve working capital efficiency will remain crucial.