Aeroflex Industries, a leading manufacturer of metal hoses used in utilities, refineries, and firefighting equipment in India, is exploring opportunities to venture into the aerospace sector. The company aims to leverage the country’s growing space program, particularly following the success of India’s recent lunar mission and the launch of its first solar mission. India’s ambitions to expand its share of the global satellite launch market by fivefold in the next decade have prompted Aeroflex to consider involvement in space-related projects.
The Managing Director of Aeroflex, expressed the company’s aspiration to have its products play a role in India’s upcoming space missions. In pursuit of this goal, Aeroflex has initiated preliminary discussions with prominent entities such as Hindustan Aeronautics Ltd (HAL), Bharat Heavy Electricals Ltd (BHEL)(these two being its existing clients), and the Indian Space Research Organisation (ISRO).
This strategic move not only demonstrates Aeroflex’s commitment to diversifying its revenue streams but also aligns with its recent successful stock market debut. The company anticipates a substantial increase in total revenue, projecting a 35% growth over the next three to four years, with aerospace contributing at least 5% to this growth.
Aeroflex’s revenue has experienced impressive growth over the past two years, surging by over 86% to reach 2.69 billion rupees ($32.5 million) for the fiscal year ending in March.
Furthermore, Aeroflex is actively pursuing a reduction in its reliance on Chinese suppliers for coils, a critical raw material accounting for half of its overall raw material costs. It is planning to source to Indian vendors. If everything goes according to the plan, 70-80% of its new orders will be fulfilled by Indian vendors, who can deliver within 4-5 days, a significant improvement compared to the over-a-month delivery time associated with Chinese shipments.
The shares of the company soared 4.78% to close at Rs.155.75 on NSE, on Wednesday.