India's Precision Engineering Boom

Airbus now buys more than $1.5 billion worth of parts and services from India every year, supporting over 15,000 jobs in the country. Boeing, meanwhile, spends more than $1.25 billion annually through a network of over 300 Indian suppliers.

India's engineering exports also reached $122.52 billion in FY26, making it the country's largest export category.

Against this backdrop, five precision engineering companies Azad Engineering, Unimech Aerospace, INDO-MIM, Omnitech Engineering and Ratnaveer Precision have all listed over the last two years. Each is betting that this growth story still has a long way to go.

Order books are growing, new capacity is being added rapidly, and their share prices have moved along with the excitement.

But before buying into the story, there's a more important question to ask:

Is the market actually big enough for all five companies to grow into?

What Precision Engineering Actually Means

Precision engineering is not about making one particular product. It is about having the skill to make extremely accurate parts, sometimes to tolerances of just a few microns.

These parts are often made from tough metals such as titanium and nickel and can go through months of customer testing before they are approved for shipment. That makes precision engineering less about mass production and more about accuracy, consistency and trust.

The industry sits within India's broader engineering and capital goods sector, which contributes nearly 1.9% of GDP. Engineering exports reached ₹10.83 lakh crore ($122.52 billion) in FY26, growing at around 6.67% annually since FY17 and becoming India's largest export category.

Iron and steel and auto components each make up roughly 20% of India's engineering exports, while industrial machinery contributes another 17%. Aerospace is still much smaller at 6.1%, but it stands out as a segment with significant long term growth potential.

Why This Industry Is Growing Right Now

1. Aerospace outsourcing: Airbus plans to increase A320 family production to around 70 to 75 aircraft a month by 2027, while Boeing is working towards 47 and eventually 52 737 MAX aircraft a month. Every new aircraft needs thousands of specialised parts, and India is becoming an increasingly important supplier base. Airbus has also expanded its presence in India with a new technology centre in Bengaluru that includes a procurement team. The important part is what happens after a company gets approved as a supplier. Aerospace customers do not change suppliers easily because every new part has to go through a long testing and approval process. Once a company gets qualified, the relationship can last for years.
2. Defence indigenisation. The same story is playing out in defence, but this time the push is coming from India itself. Defence production reached a record ₹1.78 lakh crore in FY26, while defence exports rose to ₹38,424 crore, up nearly 63% in one year. The government is also deliberately moving more defence procurement towards Indian companies. In FY27, around ₹1.39 lakh crore has been set aside for procurement from domestic defence companies. For manufacturers, that means the opportunity is not just about selling more products. It is about replacing work that was previously sourced from overseas.
3. Industrial capex. There is a broader industrial cycle underneath all of this. India has budgeted ₹12.2 lakh crore of public capital expenditure for FY27, with ₹2.19 lakh crore of defence capital spending alone. That money eventually flows into factories, machinery, machine tools, fabricated structures and precision components. So even companies that are not directly exposed to aircraft or defence can benefit from the same investment cycle.

Is The Market Actually Big Enough

This is the question that matters most. India's aerospace and defence opportunity sounds huge, but a large industry does not automatically mean a large opportunity for every company.

Start with aerospace

India's aircraft-parts market was estimated at around $16.2 billion in FY25 and is projected to reach nearly $26.7 billion by FY33, implying about 6.4% annual growth.

And India is already becoming part of this global supply chain. Airbus sources more than $1.6 billion a year in components and services from India, while Boeing sources more than $1.25 billion through 300+ Indian suppliers.

The important takeaway is not that all of this money is available to these five companies. It is that India is still building its position in a much larger global aerospace supply chain.

Defence adds another long runway

The defence opportunity is even larger. Goldman Sachs estimates India's domestic defence market could reach around ₹10 lakh crore ($122 billion) over the next 20 years. Meanwhile, defence exports reached a record ₹38,424 crore in FY26, up 62.7% in one year.

More importantly, the government is actively creating demand for domestic manufacturers. In FY27, ₹1.39 lakh crore has been earmarked for procurement from Indian defence companies, equal to about 75% of the capital acquisition budget.

So this is not just a story of a market getting bigger. A growing share of that spending is being pushed towards Indian suppliers.

But here is the catch

These headline markets are much bigger than what any one of these companies can actually address.

The five businesses operate in different niches and use different manufacturing capabilities. Unimech's aerospace tooling, INDO-MIM's metal injection moulding, Azad's specialised components, Omnitech's precision machining and Ratnaveer's stainless steel products are not interchangeable businesses.

That distinction matters. A ₹10 lakh crore defence market does not mean ₹10 lakh crore of orders are available for precision engineering companies.

Look at the scale today

Together, the five companies generated roughly ₹4,800 crore of FY25 revenue based on their reported financials a tiny number compared with the size of the aerospace and defence markets.

That suggests the industry runway is large enough. But the real investment question starts after that.

The opportunity may be big. Can each company win enough of its own niche, add capacity without hurting returns, and turn growing demand into profitable growth?

That is where the five stories begin to separate.

The Financial Snapshot

Here's how FY25 looked for each company, using the most recent full year each has reported. INDO-MIM's numbers below are its restated FY25 figures from its IPO filing, since the company's own reporting groups FY25 inside a two year disclosure window.

Note: The five companies are growing at very different speeds. Unimech and Omnitech are expanding the fastest, while Azad and INDO-MIM stand out for stronger profitability and margins. Ratnaveer is growing steadily, but operates with a much lower margin. ROCE adds another layer: it shows how efficiently each company turns the capital invested in the business into operating returns. Overall, the table shows that these companies may be riding the same industry trend, but their growth, margins and capital efficiency are very different.

Azad Engineering

Consolidated Net Profit: ₹35.16 Cr (+19.5% YoY) | Revenue: ₹172.60 Cr (+25.9% YoY)

Business model and strategic positioning

Think of Azad Engineering as the company making the high-precision components that go inside aircraft engines, power turbines and other critical machines. It supplies global OEMs such as GE Vernova, Mitsubishi and Siemens Energy, mainly as a Tier-1 supplier, with 88% of Q1 FY27 revenue coming from exports. Energy & Oil & Gas still generates 81.2% of revenue, while Aerospace & Defence grew 24.7% YoY. The company is now also moving beyond components, with its 350-kg-thrust turbojet engine opening a new opportunity in defence propulsion.

Growth catalysts and operational outlook

• A ₹6,500 Cr order book: Azad ended FY26 with an order book of around ₹6,500 Cr, roughly 11-12 times FY26 revenue. That gives the company significant visibility as these orders move into production, while management continues to target 25%+ long-term revenue growth.
• New factories are starting to matter: Facilities dedicated to Mitsubishi, GE Vernova, Siemens Energy and Baker Hughes are now operational, including Baker Hughes' 7,600 sq. m facility. Management expects these newer facilities to make a bigger contribution from H2 FY27 as utilisation increases.
• Aerospace is becoming a bigger story: Aerospace & Defence revenue reached ₹28.7 Cr in Q1 FY27, up 24.7% YoY. The delivery of a 350-kg-thrust indigenous turbojet engine to DRDO/GTRE also shows Azad is moving towards more complex and higher-value defence applications.
• Margins are moving ahead of revenue: Q1 FY27 EBITDA grew 30.7% YoY to ₹64.36 Cr, faster than the 25.9% revenue growth, pushing EBITDA margin to 37.3%. Better utilisation of the new facilities could help the company absorb fixed costs more efficiently as volumes increase.

Unimech Aerospace

Business model and strategic positioning

Unimech Aerospace makes high-precision tooling, components and assemblies used in aircraft engines, airframes, defence, nuclear and semiconductor equipment. It supplies global OEMs and Tier-1 companies, with around 90% of FY26 revenue coming from exports and customers across North America, Europe and India. The company is a key player in the global aerospace and MRO tooling market, supplying programs linked to LEAP, Pratt & Whitney and Rolls-Royce engines, as well as Airbus and Boeing platforms. With 1,100+ qualified SKUs, 35 customers and a ₹280 Cr order book including Hobel, Unimech is expanding from tooling into higher-value precision components and assemblies.

Growth catalysts and operational outlook

• Orders are building up: Unimech had a consolidated order book of ₹280.3 Cr as of June 2026, up from ₹214.9 Cr in March. Around ₹87.3 Cr came from nuclear orders, giving the company another source of business beyond aerospace.
• Aerospace recovery is showing up in numbers: Q1 FY27 revenue jumped 70.9% YoY to ₹107.6 Cr, supported by stronger aerospace tooling demand and they acquired almost 100% of Hobel Bellows for ₹450 Cr, adding metallic bellows, exhaust systems and precision assemblies. A new long term supply agreement with FACC for aerostructure components adds another customer program.
• Unused capacity leaves room for growth: The company operates 5 facilities across about 5.6 lakh sq. ft. with more than 150 CNC machines, but utilisation was around 60% in June 2026. As more products move from development to regular production, existing capacity can support higher revenue without an immediate need for large expansion.
• Profit is growing faster than sales: EBITDA increased 98% YoY to ₹39.25 Cr, taking the margin to 36.5% as revenue grew 71%. The company has also received an RFQ from a major semiconductor-equipment manufacturer, opening a potential new market beyond aerospace.

INDO-MIM

Business model and strategic positioning

INDO-MIM makes small, complex metal components using Metal Injection Moulding, investment casting, precision machining and 3D printing for automotive, defence, medical, aerospace and consumer applications. It is the world's largest MIM manufacturer, with a 6.8% global market share in CY2025 and 9,000+ product types manufactured in FY26. With 15 facilities across India, the US, UK and Mexico and customers in 55+ countries, INDO-MIM operates as a global precision-manufacturing partner rather than a domestic component supplier.

Growth catalysts and operational outlook

• Profit is growing faster than sales: Q1 FY27 revenue increased 9.4% YoY to ₹1,218.7 Cr, but PAT rose 31.6% to ₹240.1 Cr. EBITDA margin also expanded to 33.6% from 30.5%, showing a meaningful improvement.
• New Chennai capacity: INDO-MIM has started manufacturing at its new Chennai plant, adding another production base to its India operations. The facility is focused on precision manufacturing and gives the company additional capacity as customer programs scale.
• Defence and aerospace remain key growth areas: Defence contributed 18.7% and Aerospace 12.0% of FY26 revenue, while the company has also created INDO-MIM Arms Components to build a dedicated defence component business. The subsidiary was incorporated in December 2025 and is yet to begin commercial manufacturing, making execution an important next step.

Omnitech Engineering

Business model and strategic positioning

Omnitech Engineering makes high-precision metal components and assemblies used in oil & gas, power, automation and industrial equipment. It supplies critical parts to global companies such as Halliburton, SLB, Weatherford and Suzlon, rather than selling complete machines. With 256+ customers across 24 countries, 2.43 million installed machining hours and 78% of Q1 FY27 revenue from exports, Omnitech has built a global customer base and manufacturing footprint.

Growth catalysts and operational outlook

• ₹3,000 Cr order book: The order book crossed ₹3,000 Cr by July 31, 2026, giving visibility well beyond the current quarter. Around ₹2,000 Cr is linked to orders executable over 4–5 years, including a large multi-year Weatherford program.
• Capacity is being expanded: Current annualised capacity is around 31–32 lakh machine hours, while the company is planning about ₹250 Cr of capex for new facilities. Management expects the expansion to support growth into FY28 and beyond.
• Growth is broadening beyond energy: Q1 FY27 revenue was split across Energy 49%, Motion Control & Automation 24% and Industrial Equipment Systems 19%. The company is also developing its defence and aerospace business, with approvals and qualification programs underway.
• Margins are scaling: Q1 FY27 EBITDA rose 90.8% YoY to ₹50.62 Cr, much faster than revenue growth, taking EBITDA margin to 30.4%. At the same time, working capital days improved from 294 to 233, which can reduce the amount of cash tied up in growth.

Ratnaveer Precision Engineering

Business model and strategic positioning

Ratnaveer Precision Engineering manufactures stainless steel washers, tubes, pipes, sheets and fasteners used across construction, automotive, solar and industrial applications. It is India's largest washer manufacturer, producing over 1.8 billion washers annually across 3,300+ variants. The company serves 219 customers across 31 countries and has 46,668 MT of annual processing capacity, giving it both product scale and a growing global footprint.

Growth catalysts and operational outlook

• Core business is still growing: Q1 FY27 revenue rose 18.9% YoY to ₹314.6 Cr, while EBITDA grew 31.7% to ₹36 Cr, lifting the margin to 11.4%. Faster profit growth points to improving operating efficiency.
• CCL could open a new market: Ratnaveer's ₹472 Cr Copper Clad Laminate project is about 60% complete, with commercial production targeted for November 2026. Phase 1 is planned to generate ₹108 Cr revenue and ₹22 Cr EBITDA, adding an electronics-focused business beyond stainless steel.
• Product mix is changing: Management's FY27 plan increases the share of SS tubes and pipes to 19% of revenue from 5% in FY26, while fasteners are expected to rise to 10% from 5%. This reduces dependence on the traditional finishing-line business.
• Expansion backed by funding: The company has received in-principle approvals for a rights issue of up to ₹330 Cr, intended to support the CCL project and other growth initiatives. Its long-term credit rating was also upgraded to IVR A-/Stable.