DroneAcharya Aerial Innovations – Will its shares fly high like its drone?

“Today, we are one of the most recommended drone service and training companies in India, on our way to becoming a Global drone brand for the complete ecosystem of Drone offerings“

Mr. Prateek Srivastava, Founder & Managing Director

Stock data

Ticker	543713
Exchange	BSE
Industry	Education

Price Performance:

Last 5 days	+15.93%
YTD	+21.3%
Last 1 year	+62.4%

Company description:

Droneacharya Aerial Innovations Limited was incorporated in 2017 and provides a high-end ecosystem of Drone solutions for multi-sensor Drone surveys, data processing of Drone data using robust high-configuration workstations, Drone pilot training & specialized GIS training.

The company is based out of Pune and promoted by Prateek Srivastava, a first-generation entrepreneur. DroneAcharya has collaborated with various educational institutions from India and abroad such as Savitribai Phule Pune University (SPPU) in Pune, IIT Ropar, Asian Institute of Technology in Bangkok, Thailand, Rashtriya Raksha University, Gandhinagar Gujarat, Whistling Woods International in Mumbai etc.

The company has completed training more than 350+ DGCA drone pilots and 600+ other drone and GIS related training. Company claims to have a 37.9 % share in DGCA Drone Pilot Certification. As of March 2023, the company has 3,816 total DGCA drone pilots of which 2,991 are certified by Government RPTO and 825 by private RPTO.

About Promoters:

Prateek Srivastava and his wife Nikita Srivastava are the promoters of the company. Prateek Srivastava is a first-generation entrepreneur who started as a GIS developer and later turned entrepreneur. He holds B. E. Degree in IT from Saurashtra University, Gujarat and M. E. Degree in Remote Sensing and GIS from Asian Institute of Technology, Bangkok. The promoters hold 28 % in the company after the IPO. Ms. Nikita is an HR professional and is the CFO of the company. Amit Tatke, the Chief Trainer appears to be another key person in the company.

Business Verticals:

The company’s business verticals can be divided into different segments:

1. Training:

The company conducts a DGCA certified Drone Pilot course, as well as various other related courses such as Drone Building, Drones for Racing, Aerial Cinematography & Aerial Making, Implement python for GIS, industrial applications of UAV, Drone data processing etc. At the moment, their flagship 5-day DGCA Drone Pilot training course is costing Rs.64,900 (incl. 18% GST). You will get DGCA Remote Pilot Certificate which has a validity of 10 years.

2. Services:

Services vertical provides consultancy services to Govt. & private organizations, reality capture data processing software, anti-drone solution for rogue UAV, UTM air traffic management solution with help of software i.e., UGCS Mapper, UGCS Pro, Reality Capture and Aerial Cinematography & Aerial Making. The company boasts of dedicated Surveyors, UAV pilots, GIS analysts and LiDAR experts. Solutions from DroneAcharya also include multi-sensor drone surveys with high-quality service and outputs, seamless processing of drone and satellite data using robust, high configuration workstations, and customized web and mobile applications for specific Geospatial requirements.

3. Surveillance:

Under this vertical the company offers all sorts of land surveying and underwater services, data driven solutions for Power Lines and Utilities, Urban and Rural Planning, Oil and Gas Infrastructure, Roads and Highways, Mines and Quarries, Energy & Renewables, Roads & Highways, Urban & Rural Planning, Agriculture & Irrigation, Underwater Inspection and Underwater Bathymetry.

4. Others:

In this segment the company provides integrated drone solutions for Bathymetry, drone shows, Hydrography, industrial and archaeological surveys, along with Environmental Monitoring. It is also a reseller of underwater drone products from the Norwegian company Blueye Robotics. Furthermore, DroneAcharya has also partnered with Capturing Reality, a subsidiary of gaming giants Epic Games, as a premium reseller of Reality Capture, their flagship 3D photogrammetry software.

Revenue Concentration:

Top 10 customers contributed 88% of FY22 revenue. Its top customers include Technit space and Aero Works Pvt Ltd, Prianna Synergies, Venkateshwara Weighing services Pvt ltd.

Financials:

What we like:  

1. The government is highly promoting the industry:

Recognizing the immense potential of drones, the Indian government has been actively promoting adoption of Drones in various departments and industries. It has in recent times liberalized and set up a formal framework for development of the drone sector with schemes such as The New Drone Rules 2021, a PLI scheme, announcement of Drone Shakti in the Union Budget 2022 to boost or promote ‘Drone-As-A-Service (DrAAS)’, promotion of the use of ‘Kisan Drones’ for crop assessment etc. Flying of drones has now been regulated and brought under DGCA, with DGCA issuing drone pilot licenses with a validity of 10 years. Certified license holders are eligible for employment in various sectors such as defence, mining, agriculture, entertainment etc. where applications of drones are increasing day by day.

With the current growth rate of the Drone Pilot Training Sector in India, the requirement has been estimated at 1,00,000 drone pilots until the year 2025. The country has been boosted by the recently opened DGCA Authorized Remote Pilot Training Organizations (RPTO) within the last financial year. As of 31st March 2023, there are 50 RPTOs that have been set up across multiple states to certify individuals for flying drones legally throughout the country. There are more than 4000 DGCA Certified Drone Pilots in India currently.

2. The company has recently shifted to the franchisee model:

To expedite its expansion and enhance its outreach across India, DroneAcharya has devised an ingenious strategy of establishing drone training organizations through Franchises Pan – India. The Franchise model offers a unique opportunity for drone enthusiasts, entrepreneurs, and existing training institutes to venture into the burgeoning field of drone education. Franchisees will not only be able to deliver high-quality training but also create job opportunities and contribute to building a skilled workforce to support India’s drone ecosystem. DroneAcharya is successful in setting up 3 Franchises till now in India. The Locations of these franchises are: Madhya Pradesh, Uttar Pradesh, Rajasthan. These locations are a stepping stone for DroneAcharya’s success with many more Franchises to come in the near future.

3. The company has a strong entry to barrier:

You need a license to set up a drone training institute. To get a license, you need qualified drone trainers. This is an entry barrier into the training segment. The regulations for who can be a drone trainer are currently not clear, they are being framed. Till the time a proper regulation comes into play, the company can capture this market share.

Factors to consider:

1. The company’s account receivables has been increasing tremendously over the years.
2. The promoter’s holding is quite low which can further reduce as the company progresses towards scale.
3. If we analyze the competitors like IdeaForge, they are constantly improving the software which goes in the drone to help autopilot and fail safe mechanisms to return to its base as tech in its drones. This kind of tech will bring down pilot need for per Drone to more of an array of drones get operated in the control room. This kind of technology will further bring down the sales of Droneacharya whose training stands out to be a major chunk of profits.