Data Patterns Sees 37% Surge in Market Price Over Eight Trading Days Following GIC’s Rs 650 Crore Stake Acquisition.
“Data Patterns (India) Shares Surge 8% to Record High of Rs 2,550 on BSE Amid Monday’s Weak Intra-day Trade”
“The aerospace and defence company’s stock surpasses its previous high of Rs 2,484 from September 1, 2023, as the S&P BSE Sensex dips 0.5% to 72,781 at 12:31 PM.”
“In the last three days, Data Patterns’ stock has seen a 24% surge following the government’s recent easing of Foreign Direct Investment (FDI) norms in the space sector, permitting 100% overseas investment in satellite component manufacturing, aimed at attracting foreign players and private firms to the segment.”
The satellite sub-sector has undergone subdivision into three distinct activities, each with specified limits for foreign investment, as outlined in an official statement. Previously, Foreign Direct Investment (FDI) in the space sector was restricted to up to 100 percent in the realm of satellite establishment and operations, exclusively through the government route.
On another note, within the past eight trading days since February 16, the market price of Data Patterns has surged by 37 percent. This remarkable uptick follows the acquisition of over 6 percent stake in the company, valued at Rs 650 crore, by the Singapore sovereign wealth fund GIC through open market transactions.
On February 16, GIC Private Limited, acting on behalf of the Government of Singapore (GOS) and the Monetary Authority of Singapore (MAS), acquired a total of 3.54 million equity shares, representing a 6.32 percent stake in Data Patterns through open market transactions.
Concurrently, Florintree Capital Partners, led by Mathew Cyriac, divested its entire 10.71 percent stake in Data Patterns, amounting to nearly Rs 1,100 crore.
Data Patterns maintains close collaborations with defense Public Sector Undertakings (PSUs) such as Hindustan Aeronautics and Bharat Electronics, as well as government organizations engaged in defense and space research, including the Defence Research and Development Organisation (DRDO) and the Indian Space Research Organisation (ISRO).
Data Patterns is distinguished by its core competencies encompassing design and development across various domains including electronic hardware, software, firmware, mechanical engineering, product prototyping, as well as testing, validation, and verification.
The company’s involvement spans a wide array of sectors including radars, electronic warfare suites, communications, avionics, small satellites, automated test equipment, Commercial Off-The-Shelf (COTS) solutions, and programs catering to various defense platforms such as the Tejas light combat aircraft, light utility helicopter, BrahMos missile system, and other communication and electronic intelligence systems.
Strategically aligning itself with the prevailing industry conditions, Data Patterns is poised to capitalize on favorable government policies, driving a projected 15 percent Compound Annual Growth Rate (CAGR) in India’s defense production. Additionally, projections indicate that the defense outlay in India is anticipated to grow at a CAGR of 12 percent, reaching $147 billion over the FY25-29 period.
The management has affirmed that the organization is strategically positioned to leverage the anticipated growth, aligning with the broader government strategy aimed at advancing the aerospace and defense industries. This growth trajectory is supported by initiatives such as Atmanirbhar Bharat, positive intergenerationalist, and the defense modernization plan, coupled with a robust order pipeline for the Indian defense industry.
Data Patterns is actively seizing promising opportunities in radar, electronic warfare, and satellite markets. Moreover, the company is expanding its presence in export markets by actively pursuing various prospects in collaboration with domestic competitors. The management anticipates active participation in contracts ranging from Rs 2,000 crore to Rs 3,000 crore over the next three to four years, as highlighted in the Q3FY24 earnings call.
Data Patterns’ business growth is propelled by the modernization of defense platforms, driven by a focus on indigenization. The company manufactures products that directly compete with imported alternatives, reflecting its commitment to promoting domestic manufacturing capabilities. With a storied history of participation in defense modernization initiatives, Data Patterns is actively involved in various programs including the Arudhra Radar, Ashwini LLTR, Dharashakti program, MI 17 Upgrades, Dornier Upgrades, Aerostat upgrades, Lightweight EW requirements, Airborne surveillance radar, Radar Warning Receivers, and Next Gen completely wide open for LCA Mk IA and Sukhoi 30 platforms.
These strategic programs are expected to fuel the company’s core business in the short to medium term, positioning Data Patterns as a key player in the defense modernization landscape. Furthermore, the company is actively exploring opportunities in the export market, having already supplied products to the UK and Europe, with expectations for additional orders from other countries. Choice Broking, a brokerage firm, highlights that Data Patterns has strategically positioned itself from the component/subsystem level to the whole system level, enhancing its competitiveness and market reach.