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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.