Q1 2027 Apollo Micro Systems Ltd Earnings Call Transcript
Key Points
- Apollo Micro Systems Ltd (BOM:540879) reported its best-ever June quarter with standalone revenue of Rs 156 crores, EBITDA of Rs 48 crores, and PAT of Rs 28 crores, achieving record EBITDA and PAT margins of 31% and 18% respectively.
- The company entered into a definitive agreement to acquire a 41.33% promoter stake in Premier Explosives Limited for approximately Rs 1,550 crores, strengthening its presence across the entire missile and guided weapon value chain.
- Apollo Micro Systems Ltd (BOM:540879) successfully handed over its indigenously designed safety and detonation device (SDD) to the Indian Navy, featuring 100% indigenous content and reducing import dependence.
- The company received a MAG-2 prototype sanction order from the Indian Navy for the SAVIER anti-submarine warfare system, positioning it in the autonomous maritime systems segment.
- Apollo Micro Systems Ltd (BOM:540879) was selected by the Indian Air Force as the prime development agency for the IPREC program, recognizing its indigenous design and development capabilities.
- Consolidated revenue for Q1 FY27 grew 88% year-on-year to Rs 251 crores, with EBITDA up 31% to Rs 54 crores and PAT up 43% to Rs 25 crores.
- The company maintains a robust order book of Rs 1,704 crores on a consolidated basis as of August 8, with expectations of additional large orders (Rs 2,500-3,000 crores) from programs like QRSAM and MIGM by the end of the fiscal year.
- Management reaffirmed a 40-45% revenue growth guidance for the current financial year, supported by strong demand across multiple defense programs.
- Apollo Micro Systems Ltd (BOM:540879) acknowledged that quarterly revenue recognition can be uneven due to long procurement cycles and milestone-based execution in the defense industry, making quarter-to-quarter performance less meaningful.
- The subsidiary Ideal Explosives Limited continues to report losses, with management indicating that full profitability is not expected until the next financial year after a restructuring process spanning three to four quarters.
- The company currently has no export revenue, with export opportunities still in early stages and expected to materialize only after the new Unit 3 facility becomes fully operational.
- The timeline for the Premier Explosives acquisition completion remains uncertain as it is subject to regulatory approvals, with management unable to provide a definitive date.
- Promoter pledge reduction is expected to take another year to fully resolve, with management targeting completion by Q1 FY28 rather than the current fiscal year.
- The company's R&D spending as a percentage of revenue was clarified to be around 9.5% (Rs 72.53 crores on Rs 764 crores revenue), which was initially misstated during the call, indicating potential communication inconsistencies.
- Several key programs, including the anti-drone system and autonomous underwater capabilities, are still in trial or development stages, with meaningful order inflows not expected until late 2028 or beyond.
Ladies and gentlemen, good day and welcome to Apollo Microsystems Q1 FY27 Earnings Conference Call hosted by ICICI Securities Limited.
(Operator Instructions)
As a reminder, all participant clients will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes.
Should you need assistance during the conference call, please signal an operator by pressing star and then zero on your touchtone phone.
Please note that this conference is being recorded.
I now hand the conference over to Mr. Vikash Singh with ICICI Securities Limited.
Thank you and over to you, sir.
Thank you.
Good evening, everyone. A warm welcome to Q1 FY27 Apollo Microsystems results.
Thank you for joining on this Saturday.
Before we start the call, I just like to give a short disclaimer regarding the forward-looking statement which we are completely.
Based on our belief, opinion, and
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