New Delhi India’s drone industry is gaining ground on the back of favorable policies and emerging ways to use such unmanned aircraft, thereby attracting investment in the budding sector.
According to market researcher Venture Intelligence, in the 12 months through June, the number of deals in the sector doubled compared to a year ago, while the value of investments tripled. The industry raised $87 million in 10 deals last year, up from $24 million in five deals a year earlier.
“The recently revised drone regulations and the Production-Linked Incentive (PLI) Scheme for Drones have encouraged domestic manufacturing of drones, components and software for the global market, opening doors for more players to join the development ecosystem,” said Varsha Tagare, managing director of Qualcomm Ventures, the investment arm of US chip firm Qualcomm Inc.
Qualcomm Ventures was one of the investors in drone manufacturing startup IdeaForge’s $20 million Series-B funding round this April. While Qualcomm’s enterprise arm is investing in startups, the parent is providing access to reference design, platform support, and software development kits (SDKs) to help the drones be customized for a variety of applications. SDK is a collection of software tools that help in building large applications.
Vishesh Rajaram, managing partner at Special Invest, agreed with Tagare’s assessment. The VC fund led a $5 million funding round at The ePlane Company, a Chennai-based startup keen to build flying taxis, back in January.
Nevertheless, drone startups are still undervalued compared to firms in the edtech or software-as-a-service (SaaS) sectors, although companies expect them to grow in the coming months. Chennai-based Garuda Aerospace said in June that it expected its valuation to reach $250 million by the end of this month with a $30 million Series A round.
A major reason for the growth and increasing investor interest in the drone sector is that more sectors are now looking to use drones than they were limited to defense applications until a few years ago. Tagare said drones could be used for everything from security and surveillance to maintenance of oil and gas refineries and telecommunications.
Special Invest’s Rajaram said long-range, large-capacity drones are expected to see the most traction initially, “especially those providing applications for industries and business”. The first opportunity, according to him, will be for firms operating in the business-to-business (B2B) space.
Both Rajaram and Tagare agreed that investment in the industry would increase only when it matured. The rollout of 5G networks and the option of securing 5G spectrum for private networks is also expected to accelerate growth.
The government’s Drone Shakti mission, announced in this year’s Union Budget, has paved the way for companies to offer Drone-as-a-Service (DRaaS), which in turn allows them to increase revenue and attract more investors. Is.