New Delhi, Nov. 11 -- Syrma SGS Technology Ltd, an electronics system design and manufacturing (ESDM) firm, has forayed into defence and maritime segments with the acquisition of a controlling stake in a Mumbai-based defence electronics firm.
The Mumbai-listed company has signed a deal to acquire a 60% stake in Elcome Integrated Systems Pvt Ltd, which specialises in advanced electronic systems, integrated command solutions, and mission-critical technologies.
The acquisition comes weeks after Syrma bought a 49% stake in solar inverter manufacturing firm KSolare Pvt Ltd. Solar cell maker Premier Energies, which is backed by private equity firm GEF Capital, bought the remaining 51% in KSolare. Incidentally, Syrma was also previously backed by GEF Capital. The PE firm exited Syrma in 2023.
Syrma will buy the 60% stake in Elcome for Rs 235 crore through a mix of primary capital infusion and secondary transactions, according to a stock exchange filing. The balance 40% stake in Elcome will be acquired over the next three years in four tranches, contingent on performance and earn-out milestones.
Meanwhile, Elcome will take full ownership of its unit Navicom, which will be completed by the first tranche of Elcome's acquisition by Syrma. Elcome will use the funds raised from Syrma in the first tranche to finance the acquisition of Navicom, as per the filing.
Lodha Capital Markets was the sole financial advisor for the acquisition.
Syrma's acquisition of Elcome is in line with its strategy to build a scaled, design-led defence electronics platform.
Founded in 1978, the Navi Mumbai-headquartered Elcome provides electronics and systems for defence and maritime applications capabilities design, integration and lifecycle support of navigation, communication and surveillance systems deployed on naval and maritime platforms.
Its products include integrated bridge systems, navigation radars, maritime communication suites, fire detection systems, and platform monitoring solutions. For the financial year 2024-25, Elcome including Navicom recorded revenue of Rs 205 crore with an EBITDA margin of around 26%, driven by systems integration and services business. Elcome alone saw nearly 41% increase in topline in 2024-25 to Rs 155 crore, versus Rs 110 crore in the prior period.
"Elcome's extensive engineering and field service experience, combined with our industrial scale and supply chain, creates an ideal base to pursue larger integrated defence programs," said JS Gujral, managing director at Syrma SGS.
"Our focus will be on strengthening governance, operational systems and execution capabilities, while accelerating the introduction of new indigenous technologies and solutions," Gujral added.
Syrma SGS provides end-to-end solutions across product design, electronics manufacturing, and lifecycle management. It serves sectors including industrials, automotive, healthcare, and consumer electronics, supported by 14 manufacturing facilities across India and Germany.
The company also operates multiple R&D and design centres in India. Its product portfolio includes printed circuit board assemblies, box builds, radio frequency identifications (RFIDs), wire harnesses, and magnetic components. It has recently forayed into PCB manufacturing in Andhra Pradesh through a joint venture with South Korea's Shinhyup Electronics.
Published by HT Digital Content Services with permission from VC Circle.