- Zen Technologies highlights shift from platform-led to technology-led defence spending in India
- Avantel focuses on software-defined radios, targeting Rs 750 crore turnover by FY30
- Cyient shifts to Build-to-Specification, integrating AI for defence system optimisation
Zen Technologies has drawn investor attention to the shift in defence spending from platform-led procurement to technology-led systems. That shift is reshaping India's defence modernisation, which is becoming software-intensive and creating opportunities for listed companies focused on embedded systems, electronics and digital engineering.
Avantel: SDR Niche Competing With BEL and L&T
Avantel positions itself as a deep technology company driven by intellectual property. Its IT exposure lies in embedded systems integrated with software-defined hardware. The company focuses on customised electronics for the Indian defence services, with Software-Defined Radios—SDRs, radio communication systems controlled by software rather than fixed hardware—emerging as a key growth driver.
Fewer than five companies in India can design and develop complex SDR systems. Avantel supplies 1 KW HF SDRs to the Indian Navy and shipyards. Management estimates the military SDR market at about Rs 3,000 crore annually.
The company has been shortlisted as L1 and is technically qualified for Airborne SDRs for the Indian Air Force. It competes with Bharat Electronics Ltd. and Larsen & Toubro. Avantel is also bidding for new Wind Profile Radars for the Indian Air Force and ISTRAC.
Management expects growth to accelerate from FY28 as development programmes, including iDEX and SDR projects, move into mass production. The company targets turnover of Rs 750 crore by FY30, compared with Rs 249 crore in FY25, as products move from development to scale manufacturing.
Cyient: Shift To Build-To-Specification
Cyient operates through Cyient DET—Digital Engineering and Technology—and its subsidiary, Cyient DLM, which focuses on design-led manufacturing. It also operates Cyient Defense Services Inc. in the United States to support sensitive defence contracts.
The company is shifting from a services model to a Build-to-Specification approach—designing and building systems to defined mission requirements rather than executing client-provided drawings. The shift is gaining traction in aerospace and defence.
Cyient supports the value chain from design to manufacturing and aftermarket services. It supplies mission-critical systems to global OEMs and integrates artificial intelligence and machine learning—computer systems that learn from data—to optimise maintenance, extend product lifecycles and accelerate platform development under its Embracing Intelligence strategy.
Cyient DLM manufactures, machines, assembles, integrates and tests high-precision components and unmanned aerial systems. The structure positions the company as an engineering and manufacturing partner within the defence ecosystem.
AXISCADES: Power 930 Plan
AXISCADES operates in digital engineering and defence electronics. Its Engineering Research and Development vertical, ESAI—Electronics, Semiconductor and Artificial Intelligence—serves as its main technology unit and is projected to scale to Rs 500 crore by FY27.
A large part of AXISCADES' revenue comes from software that controls hardware. It designs embedded software for cockpit displays, communication systems and flight control systems. It develops software and AI algorithms for fighter aircraft such as LCA Mark 1 and integrates real-time C4I systems—Command, Control, Communications, Computers and Intelligence systems. The defence segment recorded 50% year-on-year growth in Q3FY26.
Under its Power 930 plan, AXISCADES targets revenue of $1 billion, about Rs 9,000 crore, and EBITDA margins above 20% by FY2030. Management aims to increase the share of products and solutions to 80% of revenue by FY28 from 39% currently.
The company is setting up the Missile Atmanirbhar Complex in Hyderabad for missile integration, seekers and onboard electronics. It is also building a radar integration facility at its Devanahalli Atmanirbhar Complex near Bengaluru, capable of handling 60-foot radars.
ALSO READ: Adani Defence & Aerospace And Embraer Propose E175 Final Assembly Line In India
AXISCADES has signed an MoU with Indra of Spain as its radar manufacturing partner. It is working with a global AI company to bid for AI-based unmanned combat systems and is developing anti-drone systems and loitering munitions.
The company has completed trials for RF seekers for BrahMos and Kusha missiles, with qualification expected by Q2FY27. It has developed the mission computer for LCA Mark 1, which can also support Sukhoi upgrades.
Revenue rose 16.2% year on year to Rs 886 crore. EBITDA increased 37% to Rs 144 crore and margins rose to 16.2%, up 240 basis points. Net profit increased to Rs 78 crore from Rs 44 crore in the same period last year. Core verticals, including Aerospace, Defence and ESAI, operate at margins of about 21.6%.
Apollo Micro Systems: Integrated Missile Platform
Apollo Micro Systems is moving from electronic sub-systems to a Tier 1 Original Equipment Manufacturer capable of delivering complete weapon platforms. It is also shifting from a Build-to-Print model to a Build-to-Specification model. Management has indicated that the company is entering a category of suppliers capable of delivering complete weapon platforms through full system integration.
The company completed the 100% acquisition of IDL Explosives. The integration combines electronics and guidance systems with explosives and warheads. This enables in-house production of missiles, naval mines and drones, reduces reliance on external vendors and supports participation in Make in India contracts.
Apollo Micro offers more than 700 onboard technologies and participates in over 150 indigenous programmes. It is the only qualified vendor for the Universal Homing System for Heavy Weight Torpedoes. The company is developing Anti-Submarine Warfare rockets and decoys, as well as Vehicle-Mounted Counter-Drone Systems under the Make II category, with trials expected in Q1FY27.
It holds a licence to manufacture unmanned aerial systems and collaborates on logistics and attack-class drones. It accounts for about 60% of the electronics and electromechanical systems in indigenised missile programmes.
Revenue increased 53% year on year to Rs 611 crore. EBITDA rose 61% to Rs 151 crore and margins expanded to 24.6%. Net profit grew 67% to Rs 70.6 crore. As of 31 December 2025, the consolidated order book stood at Rs 1,305 crore.
Unit 2 at Adibatla is expected to begin production by Q2FY26. Unit 3 at Hardware Park II, a 3,50,000-square-foot facility with proposed capex of Rs 250 crore, will serve as a hub for weapon integration, including missiles and mines.
Management has guided to a revenue CAGR of 45-50% over the next three years, driven by the core business and excluding the impact of the IDL acquisition. The company has earmarked Rs 100 crore for research and development in FY26.
From Zen Technologies to Avantel, Cyient, AXISCADES and Apollo Micro Systems, defence spending is increasingly linked to embedded software, AI-enabled mission systems, secure communications and integrated electronics.
The opportunity is moving from hardware manufacturing to companies that combine intellectual property, digital engineering and system integration. As India advances defence indigenisation, IT and engineering firms focused on the software core of defence systems stand to benefit.
ALSO READ: Cochin Shipyard Wins Rs 5,000 Crore Order From Defence Ministry
Disclaimer: The views expressed in this article are solely those of the author and do not necessarily reflect the opinion of NDTV Profit or its affiliates. Readers are advised to conduct their own research or consult a qualified professional before making any investment or business decisions. NDTV Profit does not guarantee the accuracy, completeness, or reliability of the information presented in this article.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.