HIGHLIGHTS
#Q1FY27
Financial Performance
– Best June quarter in history.
– Standalone revenue: ₹156 Cr.
– Standalone EBITDA: ₹48 Cr.
– Standalone EBITDA margin: 31%.
– Standalone PAT: ₹28 Cr.
– Standalone PAT margin: 18%.
– Consolidated revenue: ₹251 Cr.
– Consolidated revenue grew 88% YoY.
– Consolidated EBITDA: ₹54 Cr.
– Consolidated EBITDA grew 31% YoY.
– Consolidated PAT: ₹25 Cr.
– Consolidated PAT grew 43% YoY.
– Standalone PAT grew 43% YoY.
Order Book
– Standalone order book: ₹1,224 Cr.
– Consolidated order book: ₹1,704 Cr.
– IDL order book: ₹480 Cr.
– FY27-end target: ₹3,500-4,000 Cr.
– Large ₹2,500-3,000 Cr orders expected.
– QRSAM and MIGM drive order inflow.
– Pinaka orders also expected.
Growth Guidance
– Revenue growth guidance: 40-45%.
– Guidance applies standalone and consolidated.
– EBITDA margin guidance not provided.
– Management expects margins to improve.
– FY28 guidance after FY27 completion.
– Unit 3 changes future growth plans.
Premier Explosives Acquisition
– Acquiring 41.33% promoter stake.
– Acquisition value: ~₹1,550 Cr.
– All-cash transaction.
– Strengthens missile value-chain integration.
– Enables backward and forward integration.
– Apollo gains in-house explosives capability.
– Supports complete weapon development.
– Improves propulsion integration capabilities.
– Creates integrated defence platform.
– Current operations remain separate.
– Integration plans after acquisition completion.
– Detailed plan expected within 2-3 months.
MIGM
– DAC approval received.
– Navy inquiry expected shortly.
– Purchase order expected December-January.
– Total program budget: ~₹3,500 Cr.
– Apollo expects ~70% order share.
– 20% advance payment expected.
– Production starts from FY28.
– Execution expected over three years.
– Explosive consumption rises materially FY28.
– In-house production should improve margins.
QRSAM
– Order expected during FY27.
– Execution starts from FY28.
– BDL order expected after BEL order.
– BDL order potential: ₹11,000-12,000 Cr.
– Initial phase: 1,000 missiles.
– Apollo component value exceeds ₹1 Cr.
– Apollo supplies multiple critical subsystems.
– Guidance system supplied.
– Onboard computer supplied.
– Front/rear actuation systems supplied.
Aakash NG
– MoD cleared 1,000 units.
– Apollo component value exceeds ₹1 Cr.
– Bulk production opportunity emerging.
– Order expected during FY27.
Pinaka
– 2,000 units under negotiation.
– Negotiations reportedly completed.
– Apollo component value: ₹80-85 lakh each.
– Orders expected during FY27.
– Bulk production opportunity remains significant.
IDL Explosives
– Q1 was PAT positive.
– Profitability remains relatively low.
– Restructuring continues after acquisition.
– Cost and overhead reductions underway.
– New compounds have required licenses.
– Infrastructure augmentation is underway.
– New plants should improve revenue mix.
– Full positivity expected from next FY.
– Transformation expected over 3-4 quarters.
– Further cost measures planned.
Artillery Ammunition
– Premier testing 155mm ammunition.
– Samples supplied to Indian Army.
– Testing nearing final stages.
– Continuous orders potentially expected.
– Apollo handles fuzes and electronics.
– Premier handles ammunition portion.
– Complete filled shells already supplied.
Autonomous Defence Systems
– Navy Make-2 prototype sanction received.
– Savior ASW system under development.
– Semi-submersible autonomous vessel.
– Focused on ISR and reconnaissance.
– Autonomous maritime opportunity expanding.
– Swarm autonomous USV program underway.
– Heavy autonomy investments planned.
– Land, air and sea covered.
Smart Weapons
– Smart bomb technology under development.
– Guidance and range extension capabilities.
– Air Force has large inventory.
– Dumb bombs targeted for conversion.
– Large modernization opportunity identified.
– Nine aerial bomb variants tested.
– 1kg-25kg variants completed testing.
– Acceptance received recently.
IPREK / SDD
– IPREK is a conversion system.
– SDD handed over to Navy.
– SDD has 100% indigenous content.
– SDD reduces import dependence.
– SDD supports future weapon programs.
– Make-2 programs require ~18 months.
– Orders may follow roughly one year later.
Exports
– Current export revenue: Nil.
– Export opportunities actively being pursued.
– Direct orders targeted from friendly countries.
– Ministry approval required for exports.
– Offers submitted to multiple customers.
– Unit 3 enables larger export capacity.
– Meaningful breakthrough orders possible FY27.
– Sizeable export orders expected next FY.
Unit 3
– Large new manufacturing facility.
– First phase production started.
– Full production targeted before March 2027.
– Capacity utilization will reshape growth plans.
– Export opportunities linked to Unit 3.
– More clarity expected after December.
R&D
– R&D remains a major focus.
– Historical R&D spend: 6-8%.
– FY26 R&D: ₹27.63 Cr.
– FY26 revenue: ~₹760 Cr.
– Management later clarified R&D at ~18%.
– Indigenous technology development remains priority.
Fund Raise
– ~₹3,300 Cr funds raised.
– ~₹2,500 Cr allocated for acquisition.
– ~₹500 Cr for working capital/debt.
– Balance for corporate purposes.
– No further acquisition plan disclosed.
– Additional fund raise not confirmed.
Promoter Pledge
– Promoter pledge reduction underway.
– Management targets complete closure.
– Expected timeline: around Q1 FY28.
– Another year required for closure.
Key Positives
– Best-ever June quarter.
– 40-45% growth guidance maintained.
– Order book could exceed ₹4,000 Cr.
– QRSAM execution begins FY28.
– MIGM provides major growth opportunity.
– Pinaka adds sizeable potential.
– Premier expands vertical integration.
– Unit 3 unlocks capacity.
– Export opportunity gaining traction.
– Autonomous systems create new TAM.
Key Risks
– IDL remains loss-making currently.
– Premier acquisition execution remains pending.
– Open offer timeline uncertain.
– Large orders depend on procurement cycles.
– QRSAM/MIGM revenue starts from FY28.
– Export approvals remain necessary.
– EBITDA margin guidance unavailable.
– Integration plans still evolving.
KEY TAKEAWAY
– Apollo Micro Systems delivered a strong Q1 with record profitability, while Premier acquisition, ₹3,500-4,000 Cr potential order book, QRSAM, MIGM, Pinaka, Unit 3 and exports create significant FY28-FY30 growth visibility.