ZENTEC #Zen Technologies Ltd.#Earnings Results ConCall Q1 FY_2022
evening to all of you who kind of logged into the event of zen technologies limited i'm going to hand it over to my colleague abhishek mehra to take over the proceedings i will shake over to you uh thank you mr uh welcome everyone and thank you for joining the investor day event for zen technologies limited today we have with us mr ashoka or chairman and managing director and mr nagin rabu head of counter drone systems uh we'll be starting the event with a brief presentation from mr florey which will be followed by the q a session and virtual product development station i would like to remind you all that the call is being recorded and everything said in this call reflecting any output for the future which can be constituted as a forward-looking statement must be viewed in conjunction with the uncertainties and risks that the company faces with that said i will now kind of hand over the call to mr atlaui over to you sir uh hello everybody i'm really grateful to the ir team for organizing this event so that i could directly interact with those investors and um i'll start with the presentation but it will my presentation will be lately heavy on some slides know typical pareto rule will be followed where you know eighty percent of the stuff will be in twenty percent of the slide so i'll i'll hover around them a bit more but if you feel that i've gone over some slides faster than i should so put them in the question and answer session and i'll be more than happy to answer so i'll just start the session now the more you sweat in peace the less you bleed it more so again you know i just want to focus on the anti-drone part of the business in this presentation because we already have been talking about uh simulation uh presentation for a long time i mean we have been in that business so we see that uh we you know we have informed everyone that in the last you know i don't know august 31st we got an order from indian air force for over 155 crores for supply of counter unmanned systems counter drone systems and this is this is actually a very big deal in many ways because you know we started investing in this technology almost two and a half years back when this was not really in fashion but we you know our team bet that you know i think in future the drones will become a threat and uh we would be uh there will be a lot of demand for counter ground technology and i know in fact we were preparing for 2012 2023 23 and you know i have talked about this armenia azerbaijan war this is the war where conventional war equipment became as outdated as swords in front of guns so you know if there was a huge difference and uh people who had drones so you know in azerbaijan war they used drones to such devastating effect that they just literally walked into the country and they signed uh armenia signed a deal conceding defeat so how did this happen because they were they were having swords and azerbaijan was fought fighting with guns so what does it mean is that there's a huge shift in the scenario people a lot of countries all over the world still are having swords with them they are fighting the old war but the new war is coming and that's why we and indian government has acted very very fast they saw the threat and they started buying it we are really fortunate that they bought it from an indian company and completely indigenously developed technology very little competence imported in this and we were able to get it so there are i want to you know go a little more heavy on this so what we have seen is that when we are talking to our foreign customers and everything and when we are 28 year old company we have never seen such frictionless reception i say frictionless in the sense the moment we say anti-drone they chase us rather than we going after them and educating earlier we used to educate them why training is important but now they are running after us and they are saying listen we really want to comfort on technology now why why are these inquiries have become and now because the the one one of the questions that we usually get stumped at was they would ask has the indian armed forces have the indian armed forces purchased these uh the counter drone system from you we could not say yes to that before august 31st but now we are saying yes they have purchased it and that and they know that one of the toughest customers in the world very very difficult to convince players the indian armed forces and with this we actually are into the picture and we think that a lot of foreign countries will be coming after this technology so that's the big thing that we feel is a big change and then we and you know we think there'll be a lot of orders that will be coming for counterfeiters we are not able one of the questions how much will this order be we are not able to even start how big these orders will be they will be very big and as we are approaching you know the what is happening in the coming months so the you know the counter-prone technology consists of uh two varieties of system one is a soft kill in which you don't actually shoot down the thing but disable with electronics the drone that is coming and then the other is the hard kill in which you actually shoot it down or use a laser or some guns or something like that so we were focused on actually we were focused on soft kill option that till now but as we are speaking zen is ready even with hard kill options not they are not trying to go with fancy things like laser and all that but we are actually integrating the conventional weapons which are already there with the forces into our counter drone system to shoot down the drones and that that we think is huge because other people will be offering newer weapons but we are offering a a a subsystem that you fit into their existing it's almost like you know putting a gun into the store kind of thing so you know it's difficult to visualize but that's what we are doing and then you know our marketing and sales export team is very focused on android one systems and again we think we are also looking at other markets non-military markets like oil refineries and other strategic asset protection the the usage for this is you know from simple uh prism cells you know where people are getting uh drones to drop or knife and cell phones into the presence and you know even one president dies there's a huge woman cry so even the prisoners they have we have been approached by prison so you know how do we have a counter drones as a strategy in place all the way to oil refineries and where you know we have seen around the saudi arabia being attacked by some terrorists so those kind of things are expected to happen now so in addition why this is happening you know in a strange twist even our uh export orders for our simulators have started picking up you know we got in july we got about 154 worth of order and we have said that even this order will also be executed in the next four quarters without i mean it will be done by the first quarter of uh the first next financial year that is the latest it could happen earlier than that so so we so this is going to be a big year for us but again in addition to the old efforts of simulators are paying off and you know as we go ahead i think in the next couple of weeks or next couple of weeks or maybe at most couple of months we will be hearing the smaller orders coming out of positioning improving so that's uh that we feel little positive about that again our foreign officers are really really doing well at the uae office we are getting a lot of inquiries a lot of customers are watching remotely the demonstration we have set up this remote demonstration facility due to covet where people could see it remotely sitting in their conference room and this huge huge uh uh you know we used i i tell somewhere else but we have two per month now it's come come to about four per week so that's the amount of uh thing again you know we said we are expecting orders of 60 crores in in the coming months this may be sooner than later uh u.s office also maybe may be getting orders and um we think that uh our subsidiary uts we have i have written 15 props in f5 22 i think through much much larger than that this was the the agm figure but now we think they will get into a very very big figure and so this uh it's also so ut has also in addition to counter drone anti-drone system that they have specifically been helping us with they also have some other products and technologies that they are focused on and i think that that's another story that will develop as we go ahead again medical technology we are focusing on a couple of simulators that is something uh that may happen by this year and we may be able to show something in that regard but that's a new market i think the gestation period is going to be a little longer than uh expected have we talked about resource to the customer so you know we we always feel that you know even though we claim the credit as the promoters of the company it is made it possible and we really want to reward them so we have started uh we will be starting offering esops which was recently passed in the agm again the current order book position is this that um the domestic orders are around 278 crores and exports are about 124 floors so 400 crores of pending orders and uh so the in this the equipment cost of 284 crores we expect that these will be executed in the by the first quarter of the next year that's our expectation and uh so it's going to be a big year for us and we do think that by that time the order book position will be much much larger than what we have today so these two things uh uh show that we are very very optimistic about the coming future so this is the snapshot of what we are doing so another thing you know i just want to highlight here is that we also started getting into drones so we will be uh you know as we go ahead we will be showcasing the drones that we have developed in fact one of in one of the toughest terrains in uh you know lay our drones work very well be qualified and both grown so so we expect that these drones have market not only in india when mill indian wealthy but even across wherever there are difficult rates so we will be getting into drones in a big way and i think there will be some positive announcement in the months to come on our efforts in drones and how they are paying off the how we are how we are getting more orders in the drone segment other than counter drones so so this is uh you know they i i mean i just want to say that you know this government has been very very extraordinary helpful to us for our exports for the various policies that they are doing and uh and uh the orders that uh they placed during this order was you know this was one of the fastest orders we ever saw the government saw that there is a threat and they identified or you know in cycling in this particular order that we got there were a lot of foreign companies that tied up with indian companies and they came and demonstrated their wares and but against all odds we were able to win this thing um the whole whole uh play that we have in the zen people who have understood i mean you know we have shareholders who have been here for two almost two decades with us and they understand one thing that you know this zen is the ip play the intellectual property that they have is is massive and they can at any point in time you know we really don't know when it actually fractifies and becomes into huge orders and that's playing out at this point in time you know all these 110 patents that we have filed over past where 28 years are actually playing out so we have this huge uh r d investment that we have done there are a lot of products that are yet to be commercialized and need to be offered to the customers so all those things are also coming into play in the uh again uh you know i just want to talk about annual maintenance contracts we think annual maintenance contracts will reach the critical point you know it'll achieve a critical mass in the in the next one or two months and we will be having enough annual maintenance contracts to sustain us through the process for the periods we do not have to depend on equipment sales for that so that i think that will increase our risk for more r d but that's the situation that's going to emerge in a month or so for which we are very very very you know we feel very happy about that you know we don't have to worry about that time zero or kobe times next week if and when they happen again you know we think indian army has training establishment a huge global addressable market is huge and this even though the focus here again is you know suddenly turns to our training but again i want to say that we think counter drone system is is a huge huge uh bet that zen has made and it is paying off we think there are abundant global opportunities in this and one thing we know is the customers when they buy from us there is a huge difference from versus when they buy from any other foreign foreign other foreign companies typically we have seen the other foreign companies buy it they they sell it and forget it that's it you know they are sold and they want somebody want some maintenance or some support or some evolution they charge a lot of money and we know our track record has been that you know we we try to support the the governments for the long term and we have seen that this particular product the counterpart system is an evolving product it is not a finished product for a simple reason the threats that it will have to handle are still evolving and as the evolving uh threat scenario because of the evidence scenario everyone every buyer will seek a person who is going to handle them through the whole process so that is what we expect to uh happen uh you know that because of this uh handling which is required they would rather go with the company that has a track record of hand holding the customers through difficult times on long term basis through the life cycle of the product rather than who are just hitter and run operations so again you know fulfillment capacity we have we can wear a satellite model we get orders we can execute it without any extraordinary addition of plant and nationally we have a huge land there we can add space because the most important that we think that we do there is integration once we develop a prototype we outsource to the supply chain and supply chain does the manufacturing we do very little manufacturing of integration integration and software testing at our site so that's the thing you know i'd like to give the favorite example of the chinese bamboo tree like unfortunately it is chinese but it should be indian perhaps so you know it doesn't grow for four years and all the four years its roots are going inside it's becoming stronger and stronger and only in the fifth year it grows by it by almost 80 feet so maybe it's a zen story being done there so with this i'll conclude my brief presentation but i'm completely open for the questions answer which i think will be more interesting any participant who wishes to ask questions please raise your hand yourself and go ahead thank you for giving this opportunity and hope you're doing well it's it's great to reconnect so i have a few questions uh so first there were a few questions regarding the order book like you said 284 crores of equipment cite the order book that we have that would be typically executed uh by q1 of next year right so yeah so i want to understand sir in this current order book that you have from especially from the indian air force uh is it more uh is the entire order for the anti-drone kind of equipment and how much okay okay and how much uh from this equipment side uh you know is there a potential of you know some amount of uh order turning into an amc like post the delivery of these anti-roll systems yeah so we are not able to confirm on that but they have the if has the option of you know asking us to do the amc so but we are not very sure at this point in time of what model they would like to follow okay okay and so for the uh equipment side the on the export side the order because of 125 crore so what does it basically uh comprise of if you could just give a breakup okay okay laters and training equipment yeah okay and i think that in one of the previous calls we were also uh looking at uh logistics uh drones i don't know on the logistics how is that qualification and we qualified unfortunately we didn't win the because of the price so but i think we have got an idea you know how to bid next time and that i think is going to be a a place where we will be able to generate not only in india but even abroad so i think we were your problem with the startup so they really believe that they should not make profits so when you compete against startup is difficult to win uh even in conventional business so but but we will resolve that issue i think we are so cost competitive that uh very few companies will be able to uh you know beat us on cost basis so what kind of uh you know a potential can this uh this segment has uh for us so any numbers uh i think mostly by understating it but you can imagine it's going to be huge we expect the revenues to be huge but i mean the market to be very huge i think it's you know everything is turning to you know even medical therapy i don't know whether you saw that or not yeah but i think the biggest challenges are you know heavy heavy uh equipment being moved you know 20 30 50 kilos and above being mood and that's what we are focusing on at this point in time and also i think in an earlier uh you know uh call uh somewhere you had mentioned that we haven't you know export target of 35 so how do you think we are placed for that and what would be key two three things that would lead us you know to this target of thirty five thousand crore of exports by fbi then how much do you think we can you know get from this say what kind of potential do you see for us you know we i think uh you know this is a very early but you know the kind of response we are getting from the from the export uh countries is huge i mean uh it's running into you know few few at least few hundreds of the enquiries that we are getting i know how much will translate into the orders how will it happen is some things we still don't know but i think this is just the trickle that has crossed and we we think that it's going to uh become a huge flood in some time okay okay and so i have a few more questions can i uh ask them now or should i rejoin the queue i i don't know yeah i mean you may continue please okay okay so also you know earlier i think somewhere in feb we kind of had a 500 order in discussion you know both on the domestic side and 400 crores on the export side so i want to understand the current order book for 400 crores does it comprise of those orders which were in discussion we have which have transmitted into the confirmed order book of 400 cross or this is separate and they are still in discussion of you know those numbers you know you know i think they are these females are very fluid you know in the sense that uh as of now we are actually talking again about you know still the 400 figure is there even though we've got 120 order still the 400 is there we are still talking to some people but again we really don't know how much of the fundraiser will actually translate into orders we know that you know about 60 to 70 percent should translate but we are not very sure about that but you know the one thing good about it you know you will be seeing that the smaller orders will be trickling in as we speak and yeah in the export also finally domestic voters are still intact so they are being you know discussed and uh you know we think the files are moving in the right direction so these three are there still they are intact where in fact i would say they're little higher at this point much higher than that okay okay so and also you know historically uh you know we have seen that you know uh there have been certain years where where our profits and operating profits have consistently grown for two three years and then there is a phase where we have seen a sudden dip in our profits you know every few years so i just wanted to understand this is typically due to the industry that we operate in or do you think this trend is gonna you know can change in the future where you know consistently we will be uh making profits both operationally and at the back level and typically what kind of ebitda margins you know on a steady state basis can we uh expect both on the equipment side and the amc sites okay you know what what i would say to you know ask too many questions but you know i think we want to maintain at least 30 percent that's what we would like to do because you know every time something i really don't get in because what comes in my hand is the fact that that's the only money you can distribute to me myself and shareholders um whatever the first question you asked for you i usually note it down but i got lost yeah so this was it like historically you know what i have seen so that fluctuation is because of the industry no so yeah it is because of the industry but what we think is that you know we have got into so many segments at this point in time to your question 270 people what about the future is the future looking brighter will you make more turnover will be increased or on and so my answer to that is on an average we should be increasing but with these drones and counter drones it is almost like it is effortless and they you know they come across and they are chasing us and they are saying that we really want to buy it and there are many players in this segment so we think that we are placed very well for good growth so i just have two more questions from the combat training center you know i just wanted to understand you know what typically is the revenue model there you know how does that typically work and what kind of margins or you know you know can we can we look at for this um is actually a concept where we integrate all the simulators and the training methodology and they start from beginners to all the way to experienced seasoned veterans also it is a training round for that so what is happening at this point in time that lot of people who have purchased the simulator they are asking us to integrate the simulators and create a combat training sector so that is what is happening and we think that so it is just a sale of equipment and integration that's what compared to anything okay okay so so what i understand is we create the training center for a particular uh customer right still that sense of ownership that the army is our we should do the same kind of thing while the advanced countries have started outsourcing the other countries are still to get to that place okay okay and then probably we charge a commission or something and so just one last technical question i just wanted to understand what is the difference between anti-drone systems and anti-drone simulators you know so so you know anti-drone simulators are used because these systems are pretty expensive or comfortable system they are very very expensive they could start from about micros and go up to you know 30 40 maybe maybe 100 crores now if you want to train your soldiers would you use that equipment to literally train them so you would like to they will be retained on something or called a simulator simulator is that that will be used to train uh personnel before they operate the actual endpoint understood understood and uh so just one last question uh uh how is the abu dhabi subsidiary uh you know looking at uh looking right now because uh i think we are very impressed with the kind of things so i think we should be hearing some good news what i'm saying about experts is maybe from there only yeah okay okay thank you sir thank you so much and uh congratulations for doing such phenomenal work thank you pleasure thank uh you will take the next question from the line of mr pankaj khan consumer please i'll knew justin can go ahead yeah hello uh hi mr show this is so thank you very much for the presentation is quite impressive uh i just want to understand something on this if you order what we received here 105 cr so is it going to be fully executed the current financial year and the second question is what kind of margin we are talking so you know uh number one your execution is we have the we have this within four uh 12 months we have to execute so yes by next august it should be done that's the deadline we have and with respect to the market you know we try to maintain a thirty percent path as i said so we will we will see that you know we somehow will ensure that we get the 30 percent okay and the last question the second question is that on this maintenance contract will you have any maintenance content for this order or subsequently so so you know the the thing is this uh there is a warranty period post warranty the customer has the option of taking the amc so that will depend on whether they want to take the amc or not okay so so far they are not from they are not controlled yes okay thank you very much hello congratulations mr chloe that's looking good i can hear you i think you know we have achieved what we were planning for a long time i've got a couple of questions on this one is all your drones and these anti-drones must be powered by some battery right some power backup yeah what will be the kind of battery and the companies which are providing this kind of batteries we are sourcing them from india only the batteries so it is available in india so now i really don't know the technical answer maybe that dr nair of course some raw material by these manufacturers is being sourced from outside but as a unit there is a commodity for this heavy lift category of the drones that are being made in india but if the yeah basically we can get them in it's not a challenge the batteries are stored in hyderabad you've got one of the best companies the hbl power which makes a lot of batteries so different would you be using their kind of batteries yes i mean we are open i mean we have we have been talking to everyone and you know whichever so there is a stage now at this stage we are just doing the you know prototyping and showing it to the customers in the manufacturing phase we will we will be negotiating with these guys and buying more number of batteries so if you are just negotiating right now so that means this quarter there's not going to be much sales no no don't see are not saving anything you haven't got any order and you don't have an anti drone the account is going on look we got a large 155 that is to be exported in the next 12 months so counter tone batteries um thank you thank you we'll take the next question uh from the line of the luxury bag mr lecture please unmute yourself and go ahead so my question is regarding uh heavy lifter logistics drone so uh do you manufacture these in-house and apparently do you have any ips or development in autonomous navigation uh for these drones no so there is some software and hardware but we haven't patented them or something like that ip is there definitely but it is not admitted so regarding the question about development of autonomous navigation so yeah for example obstacle avoidance and all that stuff do you have uh these things in development for these roles they have been there yeah the secret avoidance algorithms have already been incorporated in the system so they do avoid obstacles while traversing and so in this case do you have any competition for example i think i know if only the competition is there you know unlike the counter troll space drone space has some players there are few players in drone space so we do have competition in the drone space but again you know you know so many claims being made only two companies uh qualified in the uh in the you know for this heavy drone lifting and we as far as we know no one performed even close to what we did in uh lay and agar so i think uh we're doing fantastically well in this case okay so do you have any uh interest from say online delivery uh businesses or in general other sort of businesses which look forward we are not focusing on that but you know let us see how it turns out as of now we are not we are focusing on uh military have a logistic drone applications only but let us see you know there are some expression of interest from both authorities want you know ships that are anchored in the middle of the sea how do we deliver those kind of things are going on but we are not sure how it will pan out okay yeah thank you thank you thank you uh we take the next question from the line of sister manish wendari uh mr maneesh please unmute yourself and go ahead hi good evening ashok my question is regarding the anti-drone technology anti-drone product what you have sold so would there be a different technology by the offered by the different competitors and maybe in going going forward a indian air force would be saddled with different kind of technology or you will have they will try to hone in on one kind of technology we think that you know if uh the indian companies give good uh reliable technology which i think they have you know including zen and even other electronics i think they would like to stabilize on this but you know finally it's a very very strategic call they will try to take a call but i think we we are going to ensure that they are fully satisfiedly delighted with our product and they just you know expand their requirements more and more and buy more of our product and how would you compete or maybe what kind of import uh elements you would have in your technology again we have been working for three or two and a half three years on this technology so we have deep capabilities and not only deep capabilities we can really uh modify and adapt to the customer dates when we competed with you know by the way there were about uh there were six foreign competitors in this uh uh six five or six competitors that had tied up with foreign companies and that had come but you know they were they they were double our price but maybe you know as much as technically as good as us so you know we are uh competing with the foreign guys on equal terms only thing is we are 50 of their price and that gives us an idea you know that we should probably go after um other markets also where you know the countries that want to protect their broad borders or even strategic assets would like to buy from a reliable partner a very robust technology and a person who would you know give them life for psychic support just not do a surgical strike sell them and then leave them sadly with some inoperable equipment so do did we had any preference with the new defense procurement policy in this contract yes absolutely uh we are beneficiary of that here so that eliminates your competition uh all the six completed foreign competitors in the process no no no unfortunately there are two categories one is called the bi-indian idea indigenous design development manufacturer had they gone for that actually that is the most preferred category had they gone for that then it would have eliminated all the competition but they didn't go for the most proper competition for a reason they were not sure whether indian companies have the full technology or not so they went for buy india and buy indian you can collaborate with the foreign company and come and compete with us with the indian idiom company and whoever is the least price they get the contract so it was uh there were uh uh indian players who collaborated with foreign companies so the process did not eliminate it was more the you know the competence that eliminated the competition so are you suggesting that if after this order if a new thousand crore order has to come there is a possibility that this will come in iddm and you may land up with one or two competitors only is that the whole it could happen yeah so yes now that it is established that there is the iddn product so legally all the armed forces will be forced to go for ideas that is the whole point it's a filtering process only if iddm is not there you would buy it only by india the most important part for me will be to know that how many domestic competitors do you see in this technology we see zero uh zero in the center except that they'll become electron if they have the technology with them and uh so but uh we don't see anybody guys listen to invest in r d on a consistent basis year after year not sure that you will get the reward is a game that indian defense industry has not played much my knowledge they don't i don't know if any player very few players play that game and then is a master of the game and we have invested you know hundreds of crores in building simulators now we decided to go after this market and you know i don't think you would have built you invested three years and some 20 30 crores to build a technology which you are not sure you know however you whether you can realize funds or not so i i think we maybe maybe there may be some competition but as of now i don't see any player who's invested this kind of money resources and commitment towards counter-attack technology so how much will be the price difference between you and the other elements which will cut off you know so it could start with you know i mean it could be as low as know 15 to 20 kind of thing but we saw the foreign collaborators so is it fair to assume so that for next foreseeable future as the base expands you will be 30 percent cheaper than anyone close to except am i right 30 to 40 percent cheaper easily easily and this all this this business will always be a tender business so the one with the approved technology and the lowest cost we keep on winning it you know i think you know what will happen is one thing is we will be cheaper we'll be 30 percent cheaper i i i'm sure that will be 30 percent cheaper maybe more or maybe less you know in the worst case situation but the point is you don't want to go to buy a counter drone technology from a person whose technology is not proven you know i mean we are we have they have tested their seniors and it will be deployed in the field it will be working and now you want somebody comes and says listen i have the technology we want to go with them record will be developed and we will be having a this will create a kind of a mass but people will say listen they have a proven technology it has gone through seasons so we would want to go with them so i think this track record plus right disadvantage will be absolutely unbeatable i think that's what you are driving at but and i agree with you my another question would be that if i have to see and if i as i i did follow that armenian war very closely and i also heard about this the mishaps which has happened on the border to secure the border with the anti-drone technology i think maybe a 50 000 rupees investment would be less if i have to imagine i have to stress my imagination so i wanted to know from your perspective since you work with different sources and how big will be the purchases going forward and you know their plans good enough and how big is this opportunity yes we do know the plan but we just want to say that you know we do i don't want to delve much deeper into that but i want to say that the figure that you stated is very very understated it's going to be much bigger than that only on the anti-drone or the countertop absolutely absolutely and do they have the time frame also to make this oh yeah i mean it may really really depending on the situation developing situation it may happen much earlier than we think but again you know you'll never know what for how long it will take but i think it may happen sooner than later so would you need to invest in the manufacturing processes also or maybe there is a part of outsourcing and if you really really scale to that level maybe we will have to i mean again manufacturing process we have a lot of huge capacities in hyderabad unused empty capacities we will be going and guiding them most like that is what my intention is that you know we just go coach then how to do it use the prototypes and get it done there rather than ourselves build the thing maybe though again what we do currently is we do the final integration at our place yes we do that but most of the thing also is about 8500 of the work is outsourced you would prefer that and uh but if the kind of orders we think in our little wild imagination come we we will have to you know what kind of integration what kind of testing facilities would be required to even accept those products from the supply chain would have to be re-estimated my last question is uh there is a pli scheme for drone so would you be would you be interested in taking up that scheme we are discussing with the team at this point in time about that thank you thank you team yeah thank you uh we'll take the next question from the lineup mr ashit koti or so you may please amuse yourself then go ahead uh good evening sir uh my question is with regards to is you are going to be taking a call on integration the components yourself instead of outsourcing it so what extent you would go in for manufacturing those components in-house so you know we don't manufacture at the component level it's like simulators when we say it is completely home drawn we say we don't say that you know the motherboards are made at home or anything like that what we are saying is motherboard is the intel motherboard the operating system with microsoft operating system the application on the microsoft operating system is my ip the types of it so similarly we are not doing it at a component level we are sourcing the best components getting them into a new combination and creating boards that serve our purpose and write software over them so that they can communicate with the sensors that are operating to uh you know be used as counter prone technology so that all the software layer is completely being developed the software value component would be how much sorry sorry later yeah what you are putting is your software we arrive at that is you know we just remove the bill of material cost and we arrive at the software first okay and uh what is the reason for not buying it for uh till very intelligent navigation some kind of integers we are trying to build in before filing the patent so what the work that is the point that you know we want to uh file uh ip for uh you know for all each and everything that we want to introduce to market but it is you know the current order the current order are you is it going to be executed in a one year time that's right yeah that is right yes so uh what after that let us hope that we have more orders to execute by the time no yeah so there's a possibility of you receiving the orders even from the uh military i mean say the ground forces yes i mean yes yes yes absolutely absolutely yeah so addressed for this particular you know skill auction is not yet addressed so let us hope for the best and uh all in all how much of uh tendering we have gone there was an emergency requirement with a purchase from the you know indian players like bell and then the future requirement there are no tenders open as of now but they will come up with eventually and we then will be participating in that i hope you i have already answered questions uh mr ashok if you wish to ask for any further questions i would request you to please join back in the queue uh we'll take the next question from the line of krishna getty uh krishna you may please unknow to yourself and go ahead what is the return on equity you are targeting for your shareholders you know again again you know it should be a very reasonable written on equity you know somebody came and said out of the world do you know how much return has given and i said i don't know how much then he said it has given 202 21 400 return in the last 15 16 years so that is you know more than about 1500 per annum so you know i don't know how they are what how they calculated but the fact is that yes we will we will keep growing and we will uh aim for a path margin of at least 30 percent and sir there is a continuously um circuit for your stock so you have to say something on that and nothing was supposed to zero i don't really know what to say competition with the global market and all so are you working towards that to match up with the building of your capability and the standards to meet that competition not today maybe six months or one year down the line when you leave we are ahead of the competition now and we are planning to be always ahead of the competition and in two years time they will their competition will not even they will all aspire for second position we will be absolutely there and your intention is to dominate the market and be able to dominate the market and why how do we want to dominate the market is we're investing so much in this uh process and so many projects are on at this point in time we think that we've been absolutely a good position versus the problem so are you keeping certain perspectives for the r d and all those things too yes we are we are addicted to our india actually all of our uh some of our investors don't like us because we spend so much on orange okay so thank you thank you thank you so much uh we'll take the next question from the line of mr bhagat uh mr mitra are you making yourself and go ahead yeah said i have two questions one is that uh you know bale has got this both hard kill and soft skill and whereas we have got the software so are you going for the hard kill kind of products and soft soft skill products uh going forward yeah soft skill we have we are working on the hotkey now we are actually really working on good hotkey options okay and the second question is that on this and anti-drone uh you know order that we have got uh what i understand that the gross money is around 45 45-50 percent yeah yeah it should be again i said you know i'm not talking about the gross margin but fat should be around 30 percent at least with my name when we may be able to achieve that okay why am asking this question simulators we have a much already achieved the the fat will be easily achieved at 30 percent even if the gross margins are much lower than that okay and so uh going forward like you know what can the anti-drone system or drone adrenaline and stimulator ratio in terms of revenue or the product mix like we expect some more simulator orders we expect drone engine orders also so going forward any kind of uh product mix in terms of review can be you know can guide any guidance be given maybe i i think it could be uh 50 50 or maybe a counter from your really i'm not very sure but 50 50 is easily foreseeable okay okay sir uh apart from bill and then i think one of uh you know going forward if it comes into the ide and you know any other indian company you know which you can think uh can be a serious competitor to this uh i'm not able to i i don't know personally i think there may be some companies that are working to get into this but i'm not i'm not really aware of any indian company that is developing these detectors jammers investing their own money they may be importing and reselling but that is not i don't know there's some any company having the commitment and the courage to invest this kind of money okay and so going forward i'm just trying to reiterate or trying to understand the growth driver of zen would be on jonah entry down and export export of exports right i mean the growth drivers the counter drone systems will be the growth area exports is going to be a big growth area for both simulators and counter drone systems and drones and of course because we are selling so much the annual maintenance contract will be kicking in which will be giving us sustainable revenues which will make us profitable by themselves you know i mean they're sure background back rest for us and are we banking more on express than domestic in anything of that sort you know yeah we are expecting more orders from uh there's no doubt about that we're expecting more from exports uh but domestic is also becoming very vibrant the way things are going now they're really uh placing a lot of orders and we see we can actually feel lot of action in the armed forces that you know they want to buy more stuff from companies like them okay okay thank you sir thanks a lot thank you uh we will take the next question from the lineup mr vivek gupta mr gupta there was a newspaper article some time back that a couple of startups i think one in bangla and one i think in delhi and also one order so just wanted to know are they your competitors are they do they operate in completely different spaces so i i would you just i mean could you just name the companies or what what was the order they got or something like that i don't know i think there was a bangalore based company that got an order and i think there was a delhi or noida based company i'm not sure uh along with you there were three other i think two were startups and yours was another company okay so there is a company so there is there is something called as a jammer gun that that was to have angular company i think and there was a a drone order that went to another base company that is right yeah but they are not into the counter ground space okay so they are not really your competitors no no not at all not by far they are not can you just tell me regarding the material and the software that is needed for the drones do you kind of make it yourself or is there any quality check on that you know we do the quality check on that so is this material imported or sourced locally it sourced india it's a well done they are available in india most of them also just want to know other than the military which which other aspect for the drones do you think has tremendous opportunity is it the agricultural space is it the delivery space what is the space that you foresee could have i i think agriculture is vacant personally i think agriculture is going to be big because that is most easier easiest to do but you know but we are really not focused on that at this point in time we are focusing on the logistic problems uh just one last question you also mentioned about the heavy lifting drones yeah up to what capacity or what weight would you be able to lift so this this can go easily up to 50 kilos in the sea level areas but you know at very very very high altitudes they could be 20 30 kilos um just one last question regarding the anti-drone what is the area that the antidote can cover is it five kilometers ten kilometers twenty kilometers depending because they come at a cost it's like you know how fast can the motorcycle go you know it depends on how much can we can pay for the motorcycle so here here also to completely depend on you know what kind you know 20 kilometers is not very difficult to achieve it can be achieved if you want a particular that's a different ballgame and you know what kind of uh threat neutralization do you want do you want from uh just a soft kill base or what kind of you know hard kill waste so this will determine the cost of the thing if we have to a question most of the ranges are possible you have 20 kilometer range your 40 percent ranges are possible oh thank you thank you i would request all the participants to limit the question to two co-participants will you take the next question from the line of uh mr sudhir mahajan mr sudhi you may please unleash yourself and go ahead i just wanted you to just talk a little more about that uh the combat training uh simulator which you have before is that a tender still open or is it closed because it closed last year some time then there was one that we are giving we are already they have simulators we are creating an integration facility and giving ctc to them but they are never being any cpc tender but i don't know last focus which tender are you talking about i'm not able to recollect immediately okay thank you we take the next question from the line of mr nagar agra so you may i think he's not in the questions okay we take the next question from the line lineup mr lavnish mohan mr mohan you may please yourself and go ahead hi can you hear me lovely i can hear you yeah so i just wanted to know what is your current sales and marketing setup for the domestic and the global market and what kind of investments in terms of manpower you have planned specifically on the sales and marketing scenario given the fact that you know the the markets are now the the auto bookers order books are growing and therefore uh you know i think pressing the accelerator on the sales and marketing front is is going to be the key success driver going forward yeah so you know we have a very uh you know dedicated team for this a very competitive and dedicated team for exports you know we have a high level airwise march through that's the other thing and then we have a support team that is doing it here and then we have a demo team that is uh based for virtual demo a dedicated team whenever export comes they are immediately activated and they you go through all the things we also have people who can speak arabic based in the uae who actually give the demonstration in arabic so that there is interaction and typically you know most of the people do uh you know come to us and they are seeing the demonstration so but again it's a fantastic point that you made we really need to scale up our investments in the uh export front specifically to aggressively uh address the market that's one of the agenda and focus area for investment for them that we will really want to you know this is this is almost like a startup game where you really want to reach out to the most number of countries very fast and you know install our systems there but of course not uh losing money in each installation like the startups too but we need to act as aggressively and as okay thank you yeah thank you uh we take the next question from the lineup mr marlow shah uh mr i just wanted to if you can comment on the pipeline bid for your content role system and another question is can you explain what are the tender stages when normally uh government comes out with a tender like financial grade technical bits and so on so how how does it goes so yeah so the pipeline for adhd again as i said there going on that they want to scale up the operations and then there'll be a huge way they want to scale up so we want to be the beneficiary only those companies that qualify technically their financial bits are open and whoever is the least in them if they called l1 they get the they get the tender awarded so that is the process anything else demonstration so if you'd like to put it on the screen yes so this is the antithrone system that uh we have built so just uh you know the components are being depicted and then the video will be played so drone will be flying how the system reacts to this and then acts on it is what's being demonstrated in this particular video so this is so so if there are any questions on this we can check any participant who wishes to ask any question based on the video that the management just said please speak to your hand we have a question from mr viking kumar uh mr kumar numerous my question to you is where do you see your company down the line uh 10 years or say 2030 i should let you know yeah i'll answer that question i mean you know very frankly we want at this point in time there are uh two segments that we absolutely want to be number one worldwide and we will be investing a lot of money to get the technological edge that will that will ensure that customers come up for us one is in the training segment that has been our bread and butter for last two and a half decades but we think uh drone and control technology is the second segment we will again go with the very right thing we'll be focusing on admission that but counter draw will be the technology that we really want to be number one in the world so these two segments we do expect that you know by the by 10 years time we are looking for opportunities to get into a third segment and that will happen we are not really sure what that is going to be but these these three segments we want to be number one in all the three segments that is the plan proper twenty thread no uh i i would like to know about your uh about your guidance uh of your uh financials yeah any any any vague idea because it is a very very uh huge market your for the year i think 1920 was 150 plus something and uh i heard in one of the interview that there is an opportunity of manufacturing opportunity of free electrode down the line 10 years if we say 2030 so how do you place in between those numbers many many times of what we are now at this point in time but again you know what i'm trying to say is uh i would leave that as a exercise i would really don't want to get into the financials of it but if we are the number one drone encounter ground company we are the number one simulation company what turnover do you think would uh then be achieving i think it's going to be a very very large number so but i leave it to your imagination i because i really don't uh want to state something which i maybe and my last question is what do you think that you should tell us as a as a as a stakeholder in this domain uh which we which you will never imagine to ask and as for your vision and everything you have for this company what uh what what do you would like to suggest for jen you know i mean i mean we love long-term shareholders i mean by a lot of shadows work there from day one and you know they have just been uh so every day i have children who have increased who come in the moment increases they leave us but you know i we love long-term shoulders because for them we have created a lot of a lot of health and you know so in the short term zen can behave really radically but long term we have been very consistent performers and as most of the orders came from government and the foreign governments so how do you plan to finance those orders basically it requires a lot of money so do you plan to raise more money to go public to go uh to go some some fundraising what is your in your mind regarding that yeah so you know i think we have the with respect to the fundraise we are open to you know again our shareholder the number of shares that we have have almost been the same since when the past two decades they haven't increased we haven't issued any even though we shouldn't be brought back net net we are probably you know at the time at the same level from where we started so you know so we think shares are the most expensive way of raising money we are little reticent to do that but at some point in time to when you know when we an opportunity to expand fast comes we may look at that opportunity of raising funds but as of now we have very little debt on the books so we may we can raise debt also to meet our requirements but yes equity raise is an option when you really want to aggressively expand yeah i foresee a very very bright future for this company thank you so much and wish you very very bright features thank you so much victor you really appreciate it thank you thank you so mr lori do we have a product demonstration for the simulators or should we come we have the product demonstration for the simulator so i'll just connect to that for one second oh so mr flutie what from you i'm just connecting uh they're sending a youtube link i am just connecting to the youtube videos so can you see it uh abhishek yes so we can the link me i think the best thing is directly linked through the chat box on to the youtube thing oh i i i didn't get yourself me one second i am putting the link in the chat box the youtube link okay so every anyone can click there and they can go to therapy so it's just going to the host okay sorry one second i'll just change it to everyone guys have you seen it are you getting it uh yeah yeah chat box it is there just click on the link and you can go to the thing and uh it will start now yes uh abhishek are you okay great just do good evening and welcome to the zen technologies combat training center your one stop answer to all the trading challenges faced by the armed forces today zen technologies is the leading supplier of realistic combat training solutions to the indian armed forces and is also in the forefront of providing efficient training infrastructure to foreign armies and all the indian armed contributors before i take you around the different products which are displayed here i'd like to give you a quick thing for free so this is the zen technologies production and demonstration area facility located at maheshwaram from the hyderabad international airport built over 8 acres of land at the cost of over 150 crore rupees this facility houses all the products which have been designed and developed by zen technologies over the span of the last 28 years this is also the location where the production of the various products takes place and where we are able to demonstrate our equipment which we have made over these last 28 years i shall now be starting with our first product which is behind me and that is the containerized tubular shooting range the containerized tubular shooting range is a life firing facility which is built into a standard 40 feet shipping container for easy portability it is a plug and play device and can be taken to the point of need all the ammunition of the small arms which are used by the indian armed forces and the police forces up to the caliber of 7.62 mm as well as 9mm ball can be fired in this range the only exception we have to take there is to fire the armor piercing and the incendiary ambitions such as the tracer this provides for two fires to fire simultaneously we have the two firing positions as i mentioned all the weapons up to 7.62 mm and 9mm ball can be utilized here the targets are
projected on a self-ceiling rubber membrane which is at the end of this tubular structure which you see the result of the firing is displayed on the firing point equipment which is located to the left of the firearm the targets which are projected on the same sealing rubber membrane can be depicted at a range of 10 meters to 300 meters the selection of the range of the target the type of target the terrain in which the target has to fire the kind of ammunition and the weapon to be used can be done from the firing point equipment or from the instructor station the system caters for the ballistics of the ammunition which is being fired and the result which is displayed on the firing point equipment is after the due calculations and calibration is carried out in this manner we get an absolute accurate result at even longer ranges of up to 300 meters so here you are seeing a different kind of terrain which can be utilized under different kinds of targets in this particular range the fires can fire in three positions which is standing kneeling and lying position the system comes with a ventilation system which meets the requirements of the national institute of industrial safety and health and once you close the doors of the system you are able to ensure that the minimum of acoustic signature is there outside this implies that this system can be utilized we have what we call a bullet containment trap which contains the bullet which is fired and how it acts i shall be showing you with the help of animation so here you can see the manner in which the fire will engage the target once the target is engaged the bullet goes through the self-sealing rubber membrane and enters the bullet containment track which is behind the self-ceiling membrane so here is a top view of the bullet containment trap we have the bullet is directed into the cylindrical portion where the heavy ar-500 plates are there and the bullet is broken into small pieces and it drops into the lid collection tray at the bottom controlling all this is the instructor station the instructor can have a view of both the fires and he can set the different exercises which are required for the fires all the standard exercises and firing practices which are fired by the different weapons of the indian armed forces and the police forces are pre-fed into this so he has to only select the kind of practice and the result is computed by the system based on the standards which are required and that result is displayed and after action the report is displayed on the screen and if required a copy can be taken out for the information of the fire so here here is an image of a after action report now this was a basic firing range once the trainees have reached an advanced level of training we have an advanced firing range called the containerized indoor shooting range i shall now be taking you to the containerized indoor sh
2021-09-24 11:38
