Interview: India's Aeroflex in talks to enter aerospace sector - executive

Aeroflex Industries

13/09/2023 07:51

By Hritam Mukherjee
       BENGALURU, Sept 13 (Reuters) - India's Aeroflex
Industries  AERO.NS , whose metal hoses are used in utilities,
refineries and fire fighting equipment, is in talks to enter the
aerospace sector, a top company executive said, aiming to
capitalise on the country's burgeoning space program.
    Following the recent success of its lunar mission, India
launched its first solar mission, the latest step in its efforts
to increase its share of the global satellite launch market by
fivefold within the next decade.
    "It is our aim that our products be a part of India's next
space mission," Aeroflex Managing Director Asad Daud told
Reuters in an interview last week.
    The company is in early-stage discussions with the likes of
Hindustan Aeronautics Ltd (HAL)  HIAE.NS  and Bharat Heavy
Electricals Ltd (BHEL)  BHEL.NS  and even the Indian Space
Research Organisation (ISRO), Daud said.
    While HAL and BHEL are existing clients, the ongoing talks
are a first for specific space-related projects, he said.
    The move will help the company, which made a stellar debut
on the stock market about two weeks back, diversify its revenue
stream.
    Aeroflex expects its total revenue to increase by 35% in the
next three to four years, with at least 5% coming from
aerospace, Daud said.
    Its revenue has surged over 86% in the past two years, to
clock in at 2.69 billion rupees ($32.5 million) in the year that
ended in March.
    Daud also said Aeroflex aims to cut imports of coils -- a
key raw material that accounts for half of overall raw material
costs -- from China in favour of local suppliers, who can
deliver much faster.
    Aeroflex has three Chinese suppliers that, currently, meet
70%-75% of its needs for their coils. That will drop to 50%-60%
by next March with higher local sourcing, Daud said.
    "We have spoken to a large Indian steel manufacturer who has
matched quality and Chinese prices. Going forward, 70-80% of our
new orders would be catered by Indian vendors," Daud said.
    "Domestic suppliers deliver within 4-5 days, while Chinese
shipments take more than a month to arrive."
 
 ($1 = 82.8750 Indian rupees)

 (Reporting by Hritam Mukherjee in Bengaluru; Editing by Dhanya
Skariachan)
 ((Hritam.Mukherjee@thomsonreuters.com; X: @MukherjeeHritam;))