Magellanic Cloud eyeing more acquisitions in tech & e-surveillance: Rana Rajvinder Singh

Drone technology and e-surveillance are advancing rapidly, revolutionising industries with autonomous drones and artificial intelligence (AI)-driven video analytics. Magellanic Cloud, Hyderabad-headquartered public listed company that has seen a major jump in its business with revenue tripling to over ₹560 crore over the last five years, reported a slight decline for the quarter ending June 2024, with earnings of ₹132 crore, down from ₹137 crore the previous year. Despite this dip, the company is expanding aggressively in areas like video analytics, e-surveillance, drone and other technologies. Recent acquisitions include iVIS, Scandron, Provigil Surveillance, and Motivity Labs, aimed at boosting its offerings in these sectors. 

In an interview with TechCircle, Chief Excellence Officer Rana Rajvinder Singh discussed emerging trends, challenges, and the company's long-term strategy for growth and innovation, including their focus on Generative Artificial Intelligence (GenAI) and expanding technology portfolio. Edited excerpts:   
 
What are your company's main areas of focus, and which sectors are seeing the most growth? 

We are a group of companies that has been acquiring other businesses over the past few years. Our main goal is to stay ahead in technology, so we're always on the lookout for emerging tech that we can acquire and help grow. This focus drives our strategy for acquiring various companies. 

Initially, our company was involved in diverse businesses, particularly in IT and ITES, and we did a lot of software development during the software boom. A few years ago, we acquired Motivity Labs to strengthen our position in that space. Later, we acquired iVIS, Scandron and Provigil Surveillance, companies focused on video analytics, e-surveillance, and e-guarding. These technologies are advancing rapidly, as many industries are shifting from manpower to AI-based video analytics. 

For example, ATMs used to have 24/7 security personnel, but now most rely on video analytics. This shift allows for advanced alerts using AI and machine learning, a technology with growing potential across various sectors. That’s why we acquired companies in this space — it’s one of our key growth areas. 

Last year, we also entered the drone industry by acquiring Scandron, a company that manufactures drones. These drones are autonomous and don’t require pilots, as they can be programmed and controlled from a central system. Unlike typical consumer drones, these are much larger, designed for logistics, with capacities ranging from 500 grams to 100 kilograms. 

We’re also collaborating with military commands on drone logistics and surveillance, particularly at medium and high altitudes. Right now, our core focus areas are e-surveillance and drones, where we see significant growth opportunities. 
 
What are your long-term goals for technological innovation at your company and its subsidiaries?

Our long-term strategy focuses on transformational growth and diversifying our technology portfolio. One key area is IT, specifically Gen AI, where we've made significant investments. We were early adopters of Gen AI and have built strong in-house capabilities, delivering numerous projects. GenAI is expected to remain relevant for the next decade, so we’re committed to staying at the forefront. 

We’re also focusing on surveillance and video analytics, where use cases are rapidly expanding. Another area of interest is drone technology, with heavy emphasis on research, development, and innovation in these emerging fields. 
 
How has Magellanic Cloud adapted its approach to GenAI, machine learning, and video analytics with evolving technology and changing market demands? 

Let's focus on GenAI specifically. Many companies are interested in using this technology to improve their operations. We've already completed several GenAI projects and see it becoming a major source of revenue for us in the future. 

The trends are clearly upward. We've attended various conferences and forums where the growing adoption of GenAI is evident. It's helping companies make faster decisions and streamline processes. The market potential for this is huge. 

Given our early adoption and the in-house training we've invested in, we expect to play a significant role in this space. GenAI, like machine learning, has been around for a few years now, and it’s clear that its future is bright. This technology isn't going anywhere soon. 
 
How are you adapting to advancements in drone technology and e-surveillance, as well as changes in industry regulations? 

Drone technology has evolved significantly. In the early stages of the drone industry, much of the focus was on surveillance drones. Over the past three to four years, drones have seen greater adaptability, especially as government regulations have become more structured and aligned. Now, there's more emphasis on integrating drones into daily operations, including the potential for hub-to-hub drone deliveries. 

Our company is the only one in India with DGCA type certification for logistics drones, allowing us to commercially operate these drones, which gives us a competitive edge. As India focuses more on developing domestic technology and reducing dependence on border-sharing countries, we're working to enhance in-house technology. This includes developing secure systems to prevent drones from being hacked. 

The drone industry has made significant strides in how drones are designed, built, and equipped with advanced autopilot systems. We're also addressing challenges like drone operations at high altitudes with thin oxygen through technology and simulations. The industry continues to grow rapidly, with advancements in drone manufacturing and technology expected across many areas. 

How do you see video analytics and e-surveillance shaping the future of security technology? 

When we talk about surveillance, there are many use cases across industries that require it. Video analytics plays a key role by providing precise insights. For example, in banking, it helps monitor security parameters and track who is entering the premises. It is also used for weapon detection. 

Expanding this to broader areas like border security or crowded tourist spots, video analytics helps analyse behaviour patterns. It can also identify individuals, such as those with criminal backgrounds, by using facial recognition and behaviour analysis. 

These advancements benefit various industries. In manufacturing, video analytics, combined with AI and machine learning, detects defects and anomalies. It can help stop production to correct issues, ensuring smoother operations. The applications of video analytics are vast and continue to grow with increasing precision. 
 
Where do you see the industry heading in the next five to ten years? What trends do you anticipate, and how is your company preparing for these changes? 

Opportunities in surveillance are vast as the demand for monitoring continues to rise globally. Governments are pushing for increased surveillance, which is now being adopted by many states, particularly in traffic management. The growth of smart cities has also driven the use of surveillance and analytics, which are becoming a key part of various industries. 

With the integration of video analytics in more sectors of daily life, the scope for growth is significant. To meet this expansion, we are heavily investing in research and development. We have R&D centers in Hyderabad for IT/ITeS and e-surveillance, AI and video analytics, and in Bengaluru for drones.

Our focus is on building the right expertise by developing our workforce to handle advanced use cases. As we scale up, we anticipate expanding our workforce by three and a half times in the coming years. Our main priorities are people, training, and R&D, ensuring we are well-prepared for the industry's growth without facing challenges in keeping pace. 

You mentioned serving both defense and enterprise IT sectors. What challenges and opportunities do you see in each industry? 

These are two separate areas, and the challenges we face in defense are not the same as in the commercial sector. Each has distinct use cases. For example, in commercial drone deliveries, we typically operate in urban areas with a hub-to-hub model, not direct to consumer. The goal here is to reduce traffic and travel time between congested locations, which drones can do quickly. 

On the defense side, the focus is on remote areas, like mountains with harsh weather, where supplies such as food, medicine, or ammunition need to be delivered to high-altitude posts. The conditions and requirements are different, though both rely on logistics technology. 

Similarly, surveillance needs differ. In commercial settings like banks, tourist spots, or government buildings, the scope is limited. However, at the border, surveillance covers vast areas and involves more complex analysis, such as detecting new structures or changes in the landscape. While the technology base is similar, the applications vary based on the situation. 
 
Are there any upcoming projects, innovations, or partnerships that your company is especially excited about? 

We have several ongoing projects in the defense sector where we're expecting large orders. We've resolved many issues and completed numerous No-Cost, No-Commitment (NCNC) trials, so we're anticipating strong partnerships and major orders, especially for drones and surveillance. 

We've also expanded our focus to Southeast Asia, the US, and Canada, targeting these regions for our IT, ITES, and surveillance services. Additionally, we're preparing to launch some new products that are currently in development. 

In short, we're actively expanding into new countries and middle-east and working on significant accounts. While I can’t disclose specific client names until deals are finalised, we’re also involved in mergers and acquisitions, aiming to acquire companies in similar business lines and technologies. 
 
Are there any specific technologies your company is planning to invest in for R&D? 

We're currently exploring several emerging technologies as the industry shifts and new advancements arise. For example, we're working on more advanced versions of video analytics and developing new drone models for surveillance. These drones are designed to address key defense needs, such as greater endurance and high-quality imaging.

In addition, we're looking into AI and machine learning applications across various industries. We're also exploring advancements in alternative fuel technologies, though those efforts are still in progress.