ideaForge returns to Q2 profit as revenue rises 124% year-on-year

ideaForge Technology Limited returned to quarterly profitability in Q2 FY27, reporting profit after tax of Rs 6.5 crore as revenue from operations rose 124% year on year to Rs 91.3 crore, driven by a heavier mix of defence deliveries. The result followed losses in Q1 FY27 and Q2 FY26.

How did ideaForge return to profit in Q2 FY27?

ideaForge returned to profit because defence-weighted deliveries lifted Q2 FY27 revenue, gross profit and operating earnings. Revenue from operations reached Rs 91.3 crore, rising 33% sequentially and 124% from Q2 FY26. Management did not disclose the product platforms delivered, but said the quarter had the heaviest defence deliveries and that product mix drove the change.

Gross profit rose 47% sequentially and 143% year on year to Rs 49.6 crore, producing a gross margin of 54.3%. That margin was above 49% in Q1 FY27 and 50% in Q2 FY26. Management said quarterly gross margins vary with the mix of products delivered, rather than providing a recurring margin target.

Profit after tax, or PAT, of Rs 6.5 crore compared with a loss of Rs 2.6 crore in Q1 FY27 and a loss of Rs 19.6 crore in Q2 FY26. Earnings before interest, tax, depreciation and amortisation, or EBITDA, were Rs 23.2 crore, against an EBITDA loss of Rs 8 crore a year earlier; management described the sequential EBITDA improvement as five-fold.

What did ideaForge deliver in the first half?

ideaForge executed more than 50% of its FY27 opening order book in H1 FY27 and recorded its highest H1 revenue of Rs 159.9 crore. This compared with Rs 53.5 crore in H1 FY26. Q2 contributed Rs 91.3 crore, or more than half, of the first-half revenue as delivery execution accelerated from the first quarter.

H1 gross profit was Rs 83.2 crore, with a 52% gross margin. The H1 margin was below Q2's 54.3% but above the 49% reported for Q1 FY27, consistent with management's statement that delivery mix affects margins. H1 EBITDA was Rs 27.5 crore, reversing an EBITDA loss of Rs 23.1 crore in H1 FY26.

H1 PAT was Rs 3.9 crore, compared with a loss of Rs 43.2 crore in the year-earlier half. Management said order-book execution continued despite global supply-chain constraints and delays in customer approvals for deliveries. Those constraints remained in place as of the November 3, 2026 earnings call, leaving delivery timing partly dependent on suppliers and customers.

How much of ideaForge's order book is left to execute?

ideaForge's closing order book was Rs 202.2 crore on September 30, 2026, compared with Rs 256.8 crore in Q1 FY27. Management attributed the lower balance to continued execution of existing orders and said a significant majority of the September order book was in defence. Replenishing the book was identified as a priority while current commitments are completed.

Management said the part of the order book carried over from the previous financial year would conclude in Q3 FY27. It also said Rs 202.2 crore of orders should be executed in the second half, apart from certain spare supplies linked to warranty requirements, while orders added during FY27 could spill into Q4.

The company did not quantify expected H2 FY27 order inflows. The chief executive said government procurement cycles typically create lower first-half realisation and more conversion in Q3 and Q4, and said this pattern remained on track. Management expected bidding opportunities in Q3 and the first quarter of Q4, but approvals, evaluations and awards remain outside its control.

Which products and funding plans could shape future deliveries?

ideaForge is fielding ZOLT Hybrid for commercial opportunities in FY27 after field testing demonstrated up to 100 kilometres of intelligence, surveillance and reconnaissance, or ISR, range and more than six hours of flight time. Management said the platform is at an advanced development and demonstration stage and is expected to move towards productionisation through the rest of FY27 if fresh orders are secured.

The company launched the ZOLT unmanned combat aerial vehicle variant in October 2026 and plans customer field trials for combat systems in H2 FY27. Its combat development covers air-launched effects, loitering munitions, one-way attack systems and autonomous configurations. Management said its near-term focus is multirotor-led loitering munitions, with partnerships used for capabilities such as munitions and explosives.

For the YETI logistics unmanned aerial vehicle programme, ideaForge signed a Rs 151 crore debt-funding agreement with the Technology Development Board under the research, development and innovation scheme. Management described the facility as roughly 10 years at 4% interest, with matching funding required from ideaForge. Drawdowns depend on milestones, while the YETI target of 100 kilograms over 100 kilometres remains in early flight testing and development is expected to continue into the next financial year.

What defence procurement opportunities is ideaForge pursuing?

ideaForge is pursuing procurement opportunities in ISR and combat unmanned aerial vehicle categories but did not assign a revenue value or award date to its addressable share. Management cited estimated fast-track procurement opportunities of Rs 20,000 crore across these categories, saying two or three requests for proposal, or RFPs, had already been issued and further RFPs were expected in the coming quarter.

The Defence Acquisition Council had cleared proposals worth Rs 2.12 lakh crore, including long-range unmanned aircraft systems, surveillance UAVs, integrated surveillance-and-strike systems and long-range kamikaze drone systems. Management said ideaForge should be able to bid for the majority of categories in the recent approvals, although individual tender schedules and sizes depend on each programme.

Outside India, ideaForge conducted product demonstrations for prospective South American customers and is pursuing these discussions commercially. Blue SUAS certification paperwork in the United States remained in process, which management called the critical path for a larger US opportunity. The proposed First Breach joint venture was mutually terminated without becoming operational or receiving capital, and management said US activity would continue through its wholly owned subsidiary and other partners.

Conclusion

ideaForge's Q2 FY27 turnaround reflected execution of defence-heavy deliveries: revenue reached Rs 91.3 crore, gross margin rose to 54.3%, and PAT turned to Rs 6.5 crore from losses in both the preceding quarter and Q2 FY26. The H1 result, including Rs 159.9 crore of revenue and Rs 3.9 crore of PAT, indicates that the company converted more than half of its opening order book into deliveries.

The next measure is execution and replacement of the Rs 202.2 crore September 30 order book in H2 FY27. Management expects prior-year carryover orders to conclude in Q3, plans combat-system field trials in H2 and anticipates additional procurement RFPs, while supply constraints, customer approvals and tender timelines remain unresolved.