IDBI-backed VC fund invests in Mumbai-based MRO firm
It is for the first time that a venture capital fund has invested in a component MRO firm.
- Feb 23, 2022,
- Updated Feb 23, 2022 5:30 PM IST
The Maharashtra Defence and Aerospace Venture Fund – an alternate investment fund managed by IDBI Capital Markets & Securities for Maharashtra Industrial Development Corp. (MIDC) – has invested an undisclosed amount in Mumbai-based Aman Aviation & Aerospace Solutions’ maintenance, repair and overhaul (MRO) business.
It is for the first time in the country that a venture capital fund has invested in an MRO firm undertaking servicing of aircraft components. Previous investments have been in large MROs offering airframe maintenance services.
Declining to comment on the size of the deal citing a confidentiality agreement, director Aman Aviation, Aman Johri confirmed the partnership sought to provide innovation-driven one-stop solutions in the areas of civil and defence aviation. The over 15-year-old firm currently manages an advanced MRO facility in Mumbai, with a service arm in Delhi.
“Proactive policy changes and ease of doing business have made MRO an attractive yet crucial sector of focus. A robust MRO set up for commercial airlines can eventually help reduce ticket prices in India. On the defence side, capital investments in MRO will help build greater synergies between the government and private players, as happens all across the globe,” Johri told Business Today.
“By stepping into aerospace MRO, we’re actively looking to tap into our defence offset plans laid out towards favoring a self-reliant and Aatmanirbhar Bharat. We are confident that with this partnership India will truly become a key part of the global defence supply chain in the coming times,” a separate statement from IDBI Capital Markets & Securities quoted vice president Amey Belorkar, as saying.
A recent study done by aviation consultancy Caladrius Aero Consulting has estimated that almost $800 million worth of MRO business is generated annually by commercial airline operators in India. Currently, Indian MRO players serve less than 10 per cent of this market, with a substantial part of the work getting offshored to countries like Sri Lanka, Malaysia, Singapore and the UAE. Similarly, in military aviation, nearly $1.2 billion worth of MRO business is available in India in the form of defence offsets or core MRO work of Indian fleets.
In the last few years, the MRO segment has been showcased as having rapid growth potential for potential investors by the government. Civil aviation minister Jyotiraditya Scindia has even urged Indian carriers to persuade their original equipment manufacturer (OEM) vendors to develop MRO facilities in the country.
The Maharashtra Defence and Aerospace Venture Fund – an alternate investment fund managed by IDBI Capital Markets & Securities for Maharashtra Industrial Development Corp. (MIDC) – has invested an undisclosed amount in Mumbai-based Aman Aviation & Aerospace Solutions’ maintenance, repair and overhaul (MRO) business.
It is for the first time in the country that a venture capital fund has invested in an MRO firm undertaking servicing of aircraft components. Previous investments have been in large MROs offering airframe maintenance services.
Declining to comment on the size of the deal citing a confidentiality agreement, director Aman Aviation, Aman Johri confirmed the partnership sought to provide innovation-driven one-stop solutions in the areas of civil and defence aviation. The over 15-year-old firm currently manages an advanced MRO facility in Mumbai, with a service arm in Delhi.
“Proactive policy changes and ease of doing business have made MRO an attractive yet crucial sector of focus. A robust MRO set up for commercial airlines can eventually help reduce ticket prices in India. On the defence side, capital investments in MRO will help build greater synergies between the government and private players, as happens all across the globe,” Johri told Business Today.
“By stepping into aerospace MRO, we’re actively looking to tap into our defence offset plans laid out towards favoring a self-reliant and Aatmanirbhar Bharat. We are confident that with this partnership India will truly become a key part of the global defence supply chain in the coming times,” a separate statement from IDBI Capital Markets & Securities quoted vice president Amey Belorkar, as saying.
A recent study done by aviation consultancy Caladrius Aero Consulting has estimated that almost $800 million worth of MRO business is generated annually by commercial airline operators in India. Currently, Indian MRO players serve less than 10 per cent of this market, with a substantial part of the work getting offshored to countries like Sri Lanka, Malaysia, Singapore and the UAE. Similarly, in military aviation, nearly $1.2 billion worth of MRO business is available in India in the form of defence offsets or core MRO work of Indian fleets.
In the last few years, the MRO segment has been showcased as having rapid growth potential for potential investors by the government. Civil aviation minister Jyotiraditya Scindia has even urged Indian carriers to persuade their original equipment manufacturer (OEM) vendors to develop MRO facilities in the country.