Which ASX drone company is surging more than 10%?

Boresight Ltd (ASX: BST) shares traded more than 10% higher early on Monday after the company announced a repeat order from a major North American military contractor worth more than half a million dollars.

The purchase order is three times larger than previous orders from this customer, Boresight said, and consists of more than 340 BQ-400 swarming-capable aerial target drones, multiple ground control stations and an operator training course.

Drone warfare training the focus

Boresight, which listed on the ASX in June, supplies militaries and other customers with target drones for use in battlefield training.

The company said the new purchase was the large single order to date from a North American military.

Boresight Managing director Justin Olde said:

This repeat order is testament to the ongoing effectiveness of Boresight’s aerial target drones in providing cost-effective, reliable and repeatable mission counter drone training. We have a number of North American military customers however this particular client is a standard setting, training focused organisation that has broad influence over their entire military. They’ve looked at the available options and they keep coming back to Boresight. The ability to service this and other North American customers directly from our US facility means that our delivery lead times and costs are reduced, providing more responsiveness whilst driving down overheads. Support for this delivery will be provided from our Australian HQ where required, while we continue to ramp up operations at our expanded US facility.  

Delivery and payment is expected in the second quarter of FY27.

ASX listing designed to spur growth

Boresight, which was incorporated in 2020, raised $8 million ahead of its June listing on the ASX.

The company said its goal was, “to provide low-cost aerial drone targets to service western and allied militaries as they tackle how to respond to the rapidly changing battlespace”.

The company said further:

Military customers require a cost-effective and reliable way to evaluate counter drone technologies. Once these capabilities are deployed, they must develop effective tactics, techniques and procedures (TTP’s) for their use, and undertake continuous training to ensure that personnel are properly trained, and maintain those skills, throughout the life of the technology. To achieve this, customers require low-cost, disposable training drones (targets) – and lots of them. Boresight was created to meet that need.

Boresight said at the time it had sold more than 6,000 drones to customers globally since its launch and had offices in the US, the United Kingdom, and Australia.

Boresight shares were changing hands for 36 cents on Monday morning, up 14.3%.

The company is valued at $39.9 million.

The post Which ASX drone company is surging more than 10%? appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.