About C2C Advanced Systems Limited

C2C Advanced Systems Limited is a vertically integrated Defence electronics solutions provider catering to the indigenously developed defence products industry in India. They at C2C have developed several offerings which cater to the entire spectrum of defence platform both in the air and in the sea. They have design capabilities across the entire spectrum of strategic defence solutions including processors, power, radio frequencies (“RF”), radars and microwave, embedded software and firmware. Their core competencies include hardware design and development, software design and development, firmware design and development, mechanical design and development, product prototype design and development, functional testing and validation, environment testing and verification and engineering services opportunities. They have end-to-end capabilities to build and deliver complete systems, with their design and manufacturing capabilities being completely in-house. Their key domain expertise includes C4I systems for effective situational awareness and decision support, AI/ML based big data analytics, enterprise integration of real time data from IIOT and embedded/FPGA designs.” 

The Company specializes in delivering bespoke software, hardware and firmware solutions which are driven by their own Intellectual Property and third-party partners. Leveraging their key expertise in design and development of mission critical systems, they have made significant forays in developing ‘dual-use’ solutions with focus on Industry 4.0 products with focus on providing AI/ML based advanced analytics solutions to our esteemed customers in civilian sector in the realm of manufacturing. At C2C Advanced Systems, the management team has over 100 Man years of deep domain knowledge of the Military systems- past present and the future. This includes over 35 years each for their two leadership team members and over 25 years experience in 6 of their mid management team. 
 
The business model on Digital transformation centre around four main deliveries:
• Virtual supply chain : They deliver software development based on real-time and continuous data that is delivered by various sensors and generate usable data that is actionable immediately.
• Virtual logistics : They deliver using commercial off the shelf (COTS) electronic boards and complex engineering to integrate and deliver in a engineered enclosure which can withstand harsh environmental conditions (Sub systems)
• Virtual maintenance : They integrate various subsystems to deliver systems that extract real time data and deliver situational awareness that Defence leadership can take action on (Systems)
• Application of AI/ML technologies across all offerings and as standalone product development and engineering

As of October 30, 2024, the Company employed 190 employees and breakdown of their full-time employees. The Bankers of the C2C Advanced Systems are Axis Bank Limited, Kotak Mahindra Bank Limited and IndusInd Bank Limited.

Indian Defence Sector
The Indian Defence ecosystem is a confluence between the Government and the defence manufacturing industry. Ministry of Defence has set a target of achieving a turnover of US$ 25 million in aerospace and defence manufacturing by 2025, which includes US$ 5 billion in exports.

• The government has set a target of achieving defence manufacturing worth Rs. 1,75,000 crore (US$ 21.14 billion), including defence exports of Rs. 35,000 crore (US$ 4.22 billion) by 2024-25.
• The Union Budget for Financial Year 2023-24 envisages an outlay of Rs. 5,93,537.64 crore (US$ 72.2 billion), which is 13.18 % of the total budget. This includes an amount of Rs. 1,38,205 crore (US$ 16.8 billion) for Defence Pensions. The total Defence Budget represents an enhancement of Rs. 68,371.49 crore (US$ 8.3 billion (13%) over the Budget of 2022-23.
• Over the next 5-7 years, the Government of India plans to spend US$ 130 billion for fleet modernisation across all armed services.

Over last decade, the defence, security and aerospace sectors in India have assumed position of immense strategic importance. Realizing the vital importance, the Indian government under the leadership Hon. PM Modi has laid out the goal of joining the select group of top global producers of defence, security and aerospace equipment and systems by the year 2025.The Government is embarked on serious reforms through various policy initiatives encouraging private sector to take the lead in building a globally competitive Military Industrial complex.

India’s defence and security sector is on a cusp of explosive growth. In addition, the internal and external security challenges of the country and the world continue to increase exponentially. Given this background, the need to build capacity in architecting, design and development of mission critical systems with unwavering focus on imbibing emerging technologies, cannot be over emphasised.

The true measure of a nation’s security lies in its ability to design and develop solutions that enable Defence and security architecture use advanced technologies to meet its strategic objectives. The Indian defence and security sector must usher into an era of self-reliance (Atmanirbharta) through homegrown innovations and partners who have a stake in participating in this growth.

This self-reliance must encompass the entire gamut of systems and sub-systems including, emerging areas as Integrated platforms (system of systems) for delivering situational awareness, mission planning, and command & control of diverse systems and sub-systems across multiple domains and theatres. Collaborations with global systems developers is critical as it will be mutual win-win as Indian resources can lower their cots for global sales while India gets competent to support their endeavours. Indian Defence will invest over US$ 220 billion in acquiring platforms, technologies and Software over the next 7-8 years.

Indian Defence Production Value
The value of defence production in the country crossed Rs. 1 lakh crore (US$ 12 billion) for the first time on the back of key reforms to spur growth in the sector that holds vast potential. The figure stood at Rs. 1,08,330 crore (US$ 13.07 billion) in FY23 compared to Rs. 95,000 crore (US$ 11.47billion) in FY22 and Rs. 54,951 crore (US$ 6.63 billion) five years ago. The Indian defence sector is one of the world’s largest and most profitable industries, with a 10-year pipeline of over US$ 223 billion in aerospace and defence capital expenditure and a projected medium-term investment of US$ 130 billion. The Draft Defence Production and Export Promotion Policy (DPEPP) was published in 2020, with the ambitious goal of increasing defence turnover from approximately Rs. 80,000 crore (US$ 10 billion) in 2019-20 to approximately Rs. 1,75,000 crore (US$ 21.87 billion) by 2025, including the export of Rs. 35,000 crore (US$ 4.37 billion). Among the large defence programs expected to be shifted to “Buy Global – Manufacture in India” are 114 multirole fighter aircraft (MRFA), with a gradual increase in domestic production. The FDI maximum in defence manufacturing under the automatic route has been raised from 49% to 74% (for new investments requiring an industrial licence), allowing foreign firms to establish manufacturing units with a greater degree of ownership and control.

Defence Import
Indian government endeavours to boost indigenous defence manufacturing. India ranks fourth among 12 Indo-Pacific nations in self-reliant arms production capabilities, according to a study released this month by the Stockholm International Peace Research Institute (SIPRI). Hindustan Aeronautics Ltd, Indian Ordnance Factories, Bharat Electronics, Mazagaon Docks and Cochin Shipyard are among the major Indian arms servicing companies. Ashok Leyland, one of the largest suppliers of trucks to the Indian Army, is the only company ranked in the top 50 in the Indo-Pacific. To support the domestic defence industry the government aims to ensure transparency, predictability, and ease of doing business by creating a robust eco-system and supportive government policies. Towards this end the government has taken steps to bring about de-licensing, de-regulation, export promotion and foreign investment liberalisation. Ministry of Defence has also notified three 'Positive Indigenisation lists' comprising of 310 defence equipment to be manufactured locally. Additionally, to promote export and liberalise foreign investments FDI in Defence Sector has been enhanced up to 74% through the Automatic Route and 100% by Government Route. ▪ The government has also announced two dedicated Defence Industrial Corridors in the States of Tamil Nadu and Uttar Pradesh to act as clusters of defence manufacturing that leverage existing infrastructure, and human capital.

India’s defence manufacturing is poised on a transformational cusp. Many of the impediments of the past which retarded progress in the past are being addressed. The MoD has set ambitions targets for indigenisation and its recent polices are aimed at revitalising this sector with a focus on innovation, technology development, exports, enhancing existing capacity and improving efficiencies in defence manufacturing. Restructuring within the MoD towards improving efficiency and quality is an encouraging development, The entry of the private sector also bodes well for the future. However, there are still areas where the pace of change could be accelerated. The emergence of India as a defence manufacturing hub not only to meet its own security requirements for India but for the entire region will depend on the MoD’s ability and inclination to walk the talk in ensuring that its progressive policies are implemented in both, letter and spirit.

C2C ADVANCED SYSTEMS LIMITED COMPETITIVE STRENGTHS
1. Wide Range of Products and Solutions for Defence Applications
2. Strong R&D Capabilities with a Focus on Innovation 
3. Well Positioned to Benefit from the Government’s “Atmanirbhar Bharat” and ‘Make in India’ Initiatives
4. Strong Relationships with a Diverse and Global Customer Base
5. Experienced Management Team

C2C ADVANCED SYSTEMS LIMITED STRATEGIES
1. Strengthen their Foothold in India’s Expanding Market 
2. Leveraging their Market Skills and Relationships 
3. Strengthening their Business through Effective Branding, Promotional and Digital Activities 
4. Delivering Excellence through Innovation

C2C ADVANCED SYSTEMS LIMITED RISK FACTORS & CONCERNS
1. The business has a significant proportion of their domestic revenues dependent on contracts from the GoI and associated entities including defence public sector undertakings and government organizations involved in Defence. 
2. They are having a high trade receivable days and high trade payables days in the last 2 financial years.
3. A major portion of their revenue is from projects undertaken with Government entities or agencies, contracts of which usually contain terms that favour the clients.
4. They depend on exports for a significant portion of their revenue.
5. There has been a delay in the deposit of Tax Deducted at Source.