Dynamatic plans Rs 29.18 crore UAV sale to Dynauton and 83.33% stake

Dynamatic Technologies Limited will transfer its unmanned aerial vehicle (UAV) vertical to Dynauton for Rs 29.18 crore, while a planned Rs 37.45 crore share subscription is expected to leave Dynamatic with about 83.33% of Dynauton after an employee stock-option (ESOP) trust allotment. The Board approved the transactions on 24 October 2026.

Why is Dynamatic transferring its UAV vertical to Dynauton?

Dynamatic is transferring the UAV vertical to Dynauton through a slump sale on a going-concern basis for Rs 29.18 crore. The consideration is based on a valuation report from a registered valuer and remains subject to required approvals and consents. Dynamatic expects the transfer to be completed on or before 31 December 2026.

Dynauton was a wholly owned subsidiary of Dynamatic before the proposed capital transactions. The 24 October 2026 announcement describes the transfer as a sale of the UAV vertical on a going-concern basis, but does not disclose the vertical's revenue, profit, asset values, customer contracts or employee numbers.

The Board approved the transaction after the 30 September 2026 reporting date. Dynamatic therefore treated it as a non-adjusting event and made no adjustments for it in the financial results for the quarter and six months ended 30 September 2026. The proposed sale is consequently separate from the financial performance reported for that half-year.

How will Dynauton's preferential issue change Dynamatic's holding?

Dynamatic will subscribe to 74.90 lakh Dynauton equity shares at Rs 50 each for Rs 37.45 crore. Each share has a face value of Rs 10, and the stated issue price includes a premium. The subscription forms part of Dynauton's preferential issue of 79.90 lakh shares approved on 24 October 2026.

The remaining 5.00 lakh shares in the 79.90 lakh-share preferential issue will be subscribed by Dr. Udayant Malhoutra, Dynauton's Founder Chairman and Director, on the same Rs 50-a-share terms. That subscription amounts to Rs 2.50 crore. Separately, the proposed ESOP trust will subscribe to 10.00 lakh shares at Rs 10 each after it is established, amounting to Rs 1.00 crore.

After the preferential issue and the subsequent ESOP trust allotment, Dynamatic expects to hold approximately 83.33% of Dynauton. Dynauton is expected to remain a Dynamatic subsidiary. The filing gives the expected ownership percentage but does not provide Dynauton's pre-issue share capital or a final shareholding table for each proposed shareholder.

What do the transactions mean for Dynamatic's reported results?

The proposed Rs 29.18 crore UAV transfer and Rs 37.45 crore Dynauton subscription did not adjust Dynamatic's financial results for the six months ended 30 September 2026. Standalone revenue from operations was Rs 417.97 crore, compared with Rs 360.15 crore in the corresponding six months ended 30 September 2025, while profit after tax was Rs 16.70 crore, down from Rs 30.10 crore.

Revenue increased by Rs 57.82 crore in the six-month comparison, while profit before tax and exceptional items declined by Rs 17.69 crore to Rs 22.69 crore from Rs 40.38 crore. Those figures cover a period ending before the 24 October 2026 Board decision, and the filing says no adjustments were made for the post-reporting-date transactions.

Aerospace segment revenue was Rs 186.68 crore for the six months ended 30 September 2026, up from Rs 174.71 crore a year earlier. Its segment result, measured before finance costs, other income and tax, fell to Rs 29.55 crore from Rs 42.89 crore. The filing does not separately allocate the UAV vertical's revenue or profit to the Aerospace segment.

What approvals and steps remain before the UAV transfer closes?

Dynamatic expects the UAV vertical transfer to close on or before 31 December 2026, subject to the required approvals and consents. The announcement does not identify the approving authorities, conditions precedent, payment timing or settlement method for the Rs 29.18 crore consideration.

The ESOP trust allotment has a separate condition because the trust must first be established. The filing says the 10.00 lakh shares would be issued at Rs 10 each upon that establishment, and links Dynamatic's expected 83.33% holding to the later allotment as well as the preferential issue.

The transactions were disclosed with financial results approved by Dynamatic's Board on 6 November 2026. On the same date, the Board declared an interim dividend of Rs 2 per equity share for financial year 2026-27. That dividend declaration is separate from the Dynauton restructuring and does not form part of the Rs 37.45 crore subscription.

Conclusion

The restructuring would place Dynamatic's UAV vertical in Dynauton through a Rs 29.18 crore going-concern slump sale while broadening ownership of the subsidiary. Dynamatic plans to invest Rs 37.45 crore, Dr. Udayant Malhoutra plans to invest Rs 2.50 crore, and the proposed ESOP trust would invest Rs 1.00 crore, leaving Dynamatic with an expected 83.33% holding.

The next disclosed milestone is completion of the UAV transfer on or before 31 December 2026, subject to approvals and consents. The establishment of the ESOP trust and its subsequent 10.00 lakh-share allotment also remain relevant because Dynamatic has tied that step to its final expected Dynauton ownership percentage.