Mathew Cyriac's Midas touch: Four defence-linked IPOs, all subscribed over 100 times

When Tonbo Imaging India's IPO closed with an oversubscription of 135.8 times earlier this week, it marked a milestone not just for the Bengaluru-based defence electronics original equipment manufacturer (OEM), but also for a low-profile yet widely respected investment leader known for backing entrepreneurs. Meet Mathew Cyriac, executive chairman of private equity firm Florintree Advisors and co-founder of Yali Capital, a deep-tech investment platform. Cyriac hails from Kaduthuruthy, a historic town in Kerala's Kottayam district known for its temples, churches and mythological roots. A veteran dealmaker, he was co-head of private equity at Blackstone's India office from 2006 to 2017. Blackstone is the world's largest alternative asset manager. Here's a statistic worth noting: Tonbo Imaging is the fourth consecutive defence-linked IPO backed by Cyriac to have been subscribed more than 100 times. The three other companies in this club made their stock market debuts between March 2021 and July 2023. The first is Chennai-based Data Patterns, a vertically integrated defence and aerospace electronics solutions provider. Its IPO was subscribed nearly 120 times. Next is ideaForge, a Navi Mumbai-based unmanned aerial vehicle (UAV) or drone maker serving sectors such as defence, disaster management and agriculture. Its IPO was subscribed 106 times. Incidentally, a prototype developed by ideaForge featured in the Bollywood blockbuster 3 Idiots, released in 2009. In the film, Aamir Khan's character, Rancho, fixes the UAV, which later caught the attention of the Defence Research and Development Organisation (DRDO). Hyderabad-based MTAR Technologies completes the list. The precision engineering company caters to sectors including space, civil nuclear power, defence and aerospace. Its IPO was subscribed more than 200 times. That's not all. Data Patterns, ideaForge and MTAR Technologies gained 46.3%, 93.5% and 82.6%, respectively, over their IPO prices on listing day. Tonbo Imaging is scheduled to list on October 23. Cyriac has fully exited MTAR Technologies and Data Patterns and currently holds an 8.3% stake in ideaForge. Meanwhile, the multiple on invested capital (MOIC), measured against the IPO price, stands at 6.93 times for Data Patterns, 1.05 times for ideaForge and 12.48 times for MTAR Technologies for Cyriac's investment team, according to data reviewed by Moneycontrol. ideaForge's share price has experienced sharp swings in the past, reflecting factors such as defence order flows and fluctuations in quarterly profits. MOIC is a private equity metric that measures the total value generated by an investment relative to the initial capital invested. Mathew Cyriac's mantra An alumnus of IIM Bangalore, Cyriac leads Florintree's scale-up strategy and has backed several pre-IPO and growth-stage companies. The firm invests across technology, industrials, healthcare and financial services. What explains his penchant for companies associated with the defence sector, and what drives his investment strategy? When contacted by Moneycontrol, the reticent Cyriac declined to comment. However, his official profile on the Yali Capital website offers a glimpse into his investment philosophy. "As the Indian investing market evolves, I believe it will need innovation and sophistication that suit the nuances of the Indian market. I was very interested in building something from the ground up. Throughout my career, I've learned that successful investing requires integrating business excellence with purpose-driven leadership. I see strong opportunities in homegrown deep tech companies in sectors such as aerospace, imaging, instrumentation, and several other emerging areas. India has a real opportunity to build globally competitive public companies in this space. This conviction drove Yali Capital's founding and our work with exceptional entrepreneurs building world-class technology businesses from India," the profile says. The broader outlook for the defence sector is also supportive. Brokerage firm Kotak Institutional Equities expects FY27 to be an inflection year for the sector, supported by healthy order books, improving execution and rising export opportunities. In July, the brokerage said companies across precision engineering, defence electronics, radio frequency (RF) and microwave systems, anti-drone platforms and aerostructures had demand visibility of two to four years, backed by increasing localisation and stronger procurement by defence public sector undertakings. An industry executive, who spoke to Moneycontrol on condition of anonymity, said Cyriac had built considerable credibility in the market. "Mathew Cyriac has built a lot of credibility in the market. He guides companies and promoters to price their IPOs reasonably and leave sufficient value on the table for investors. That creates goodwill and even in a cluttered deal environment, investors are keen to look at deals backed by him in greater detail," the executive said. Arvind Lakshmikumar, founder and CEO of Tonbo Imaging, has known Cyriac for many years. The investor had backed the company in an earlier Series D funding round. "We chose Mathew over other people who were offering higher valuations. He is a disciplined and committed investor. IPOs are complex processes, and he can roll up his sleeves when required. Across manufacturing, tech, products, product engineering & design and services, as well as both the domestic and export markets, he has spread himself well across various sub-segments under the defence theme," Lakshmikumar told Moneycontrol. In June, Cyriac, who currently sits on the boards of ideaForge and Data Patterns and is chairman of apparel maker Gokaldas Exports, acquired a stake in listed tile maker Nitco. What's next on his defence radar? More than three years ago, Florintree Advisors acquired a 15% stake in New Delhi-based drone maker BotLab Dynamics. The company has previously collaborated with the Army Design Bureau, which serves as an interface between the Indian Army and the wider innovation ecosystem. BotLab Dynamics operates two verticals: drone light shows (DLS) and Vayudh, its dedicated defence and tactical drone technology arm. Industry sources told Moneycontrol that the company is likely to explore an IPO in the next one to two years. With the government aiming to make India a global drone hub by 2030, the question is whether BotLab Dynamics could become Cyriac's fifth defence-linked IPO success.