Frugal moon mission to help fuel rise of Indian firms: CLSA

Brokerage CLSA said India's success in landing on the moon at a third of the global average cost should strengthen the 'Make in India' theme and open up global rocket, launch and satellite markets for Indian companies such as L&T.

The firm said India has a minuscule share of the global market as it was a captive business dependent on ISRO. But now with the sector opening up and IN-SPACe acting as a single window clearance for ease of doing space business, its share could increase, it said.

"The global space economy is primarily driven by a record number of satellite launches, technology innovations, demand for lower costs and growing communication needs," said CLSA in a note on Thursday. "With its cost-competitive launch cost, India's private ventures should help capture this market."


The brokerage said the cost of Chandrayaan-3 was said to be $75 million as against NASA's Artemis Space Launch System's cost of $24 billion. Shares of some companies that supply equipment and components to the space sector extended gains on Thursday after rallying up to 15% the previous day, ahead of the landing of the Chandrayaan-3 spacecraft on the moon. Centum Electronics jumped 7.3%, Mtar Technologies rose 3.8% and Paras Defence surged 6.1%. L&T declined 1.1% and Hindustan Aeronautics dropped 1.6%

"Next, India should launch a mission for a solar observatory and put a man on the moon," said CLSA. "Success would solidify India's right to win in the global market and its vendors such as L&T." The brokerage has a target of ₹3,080 on the stock, which is 14.6% above Thursday's closing price of ₹2,687.50

The firm said the global space market is $447 billion, of which rockets are a $13 billion market and satellites are $16 billion. India has less than 5% share of the global market.