Apollo Micro Systems Q1 Profit Soars 119%; Defence Stock Fixes Record Date For Dividend

Shares of Apollo Micro Systems Limited are in focus after the company published strong results for the 1st quarter of FY26. Investor confidence in the company's prospects seemed to have increased as the company's market capitalisation reached Rs 5,400 crore.

Comparison of Q1 FY26 with the same quarter last year showed Apollo Micro Systems reported a net profit of Rs 18.5 crore, marking a striking 119% increase from Rs 8.43 crore. Furthermore, revenue from operations improved by 46.46% year-on-year to Rs 133.58 crore, up from Rs 91.20 crore in Q1 FY25.

In the announcement, the Board of Directors has set a record date of September 9, 2025, for final dividend at the rate of 25% (Rs 0.25 paise) per equity share of Re. 1/- each fully paid-up of the company for the financial year 2024-25, which is subject to approval by the shareholders during the AGM scheduled for September 16, 2025. Should approval be given, it is anticipated that the dividend will be paid out within 30 days after approval has been granted.

Mr. Baddam Karunakar Reddy, Managing Director, Apollo Micro Systems Limited, said: "I'm pleased to share that Apollo Micro Systems has commenced FY26 with exceptional momentum, delivering our strongest-ever Q1 performance - a clear reflection of our strategic focus, operational excellence, and the unwavering dedication of our team. In Q1 FY26, we achieved a remarkable 46% year-on-year revenue growth, reaching ₹1,335.8 Mn, up from ₹912.0 Mn in the same quarter last year. This growth has been driven primarily by the robust execution of our order book and the seamless transition of several high-value systems into production."

"Our EBITDA (excluding Other Income) grew by 83% to ₹409.4 Mn, compared to ₹223.7 Mn in Q1 FY25. More notably, our EBITDA margin expanded by 600 basis points, standing at 31% in Q1 FY26, compared to 25% in Q1 FY25 - a clear indication of strong operating leverage and improved cost efficiency. This momentum also translated into the bottom line. Our Profit After Tax (PAT) more than doubled, growing 110% year-on-year to ₹176.8 Mn, up from ₹84.3 Mn in Q1 FY25. PAT margin also expanded by 400 basis points year-on-year and quarter-on-quarter, reaching 13% in Q1 FY26, as against 9% in Q1 FY25," Baddam Karunakar Reddy further added.

"Looking ahead, we expect revenue to grow at a CAGR of 45% to 50% over the next two years - driven solely by the core business, excluding any contribution from the recent acquisition. This growth is underpinned by a healthy order book and multiple products entering the production phase. Operating margins are projected to improve in the first half of FY26 due to favorable operating leverage and product mix. However, ongoing and planned capital investments are expected to moderate margin expansion in the latter half of FY26 and into FY27," Baddam Karunakar Reddy commented.

Apollo Micro Systems has implemented a robust order and enhanced execution of strategic defence programs as a tier 1 integrated defence OEM. The company also made a strategic acquisition of IDL Explosives Ltd, strengthening its position as a fully integrated Tier 1 defence OEM. Recently, the company received a notable defence export order of USD 13.37 million for a sophisticated avionics system, which also shows the company's alignment with the self-sufficient policies of India in defence manufacturing.

The company specialises in electronic, electro-mechanical, and engineering design solutions for defence, space, and homeland security, serving the Ministry of Defence, public sector undertakings, and select private sector clients.