Solar Industries stock jumps 10% after company wins ₹2,039 crore defence export order
Solar Industries shares surged 10% to ₹11,597 after the company secured export orders worth ₹2,039 crore for defence products. The company expects strong growth in domestic and international markets, raising its FY25 capex guidance to ₹1,200 crore.
Shares of Solar Industries jumped 10 per cent in early morning trade on December 3, reaching a six-week high of Rs. 11,597 per share, following the announcement of a significant order.
In an exchange filing on Monday, the company announced that it had secured export orders worth ₹2,039 crore, along with its subsidiary, for the supply of defence products. The order will be delivered over the next four years.
Earlier in November, the company had secured two similar export orders worth ₹580 crore and ₹399.4 crore for the supply of defence products.
Additionally, in the same month, it secured another major order worth ₹887 crore from Singareni Collieries Company for the supply of SME explosives and LDC explosives and initiating systems for blasting overburden.
Analysts are bullish on the stock as they believe the company will get a boost from domestic demand and steady growth in exports.
Solar Industries manufactures and supplies industrial explosives and explosive accessories. It primarily serves sectors such as mining, infrastructure, and defence. The company has a significant presence in the international market, and it exports its products to various countries.
The company’s order book at the end of Q2FY25 stood at ₹5,700 crore. In light of recent orders and upcoming opportunities, the company has significantly revised its annual capex guidance upward, increasing it from ₹800 crore to around ₹1,200 crore for FY25.
The company expects to receive the Pinaka orders soon, along with additional orders from international customers. It remains optimistic about achieving defence product sales of ₹1,500 crore, with defence products accounting for approximately 20 per cent of total sales for FY25.
Multibagger performance
From a trading price of ₹1,027 apiece four years ago, shares of Solar Industries India have skyrocketed to the current trading price of ₹11,018 apiece, rewarding their shareholders with a whopping return of 973 per cent.
The stock has consistently demonstrated remarkable gains throughout this period. In the calendar year 2021, it delivered a multi-bagger return of 122 per cent, followed by another impressive rally of 83 per cent in the subsequent year. In the calendar year 2023, the stock added a notable gain of 54 per cent. In the current year so far, the stock has further jumped by 62.35 per cent.
For the Q2FY25, the company achieved its highest-ever quarterly EBITDA and PAT at ₹475 crore and ₹304 crore, respectively, registering a PAT growth of 45 per cent YoY. Additionally, the company posted its highest-ever half-yearly EBITDA and PAT at ₹949 crore and ₹604 crore, reflecting a PAT growth of 47 per cent for the first half of FY25.
The company also achieved its highest-ever half-yearly EBITDA and PAT margins, at approximately 27.90 per cent and 17.77 per cent, respectively.
Disclaimer: We advise investors to check with certified experts before taking any investment decisions.
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