Apollo Micro Systems Receives Rs. 4.65 Cr Order From Adani & DRDO

Apollo Micro Systems, a small-cap firm in the aerospace and defense sector, is in the news after announcing on Friday that it has secured orders totalling Rs. 4.65 crores from Adani and the Defence Research and Development Organisation (DRDO).

"We are also pleased to inform you that the Company has been declared the Lowest Bidder for orders worth Rs. 16.96 crores from DRDO, Public Sector Units, Indian Navy and Indian Army. We are eagerly anticipating the release of the official order copies shortly," the company also said in a stock exchange filing.

On Thursday, November 21, Apollo Micro Systems Ltd. notified the stock marketplaces that its board had decided to terminate the preferential issue of 2.45 crore convertible warrants to its promoters and non-promoter enterprises. The Board recommended at its July 23, 2024, meeting to preferentially issue 2,45,00,700 convertible equity warrants to certain selected non-promoter individuals and corporations. The issuing of convertible warrants was authorised by the Members during its Extra Ordinary General Meeting on August 16, 2024. BSE Limited and NSE Limited granted the firm in-principle permission on November 14, 2024, to offer these warrants at a price of Rs. 108.15/-each, convertible into equity shares of Re. 1/-each.

However, certain significant proposed allottees, including AG Dynamic Funds Ltd., North Star Opportunities Fund VCC-Bull Value Incorporated VCC Sub-fund, Eubilia Capital Partners Fund I, and Eminence Global Fund PCC, have sent letters to the company withdrawing their consent to subscribe for the convertible equity warrants. Between the date of their first approval on July 22, 2024, and the offer beginning date on November 14, 2024, they indicate probable delays in the preferential offer's opening. According to the aforementioned addressed allottees, the long hiatus caused them to reconsider their strategic and financial interests, which ultimately resulted in their decision to terminate their subscriptions.

Apollo Micro Systems stated that the withdrawal will not affect its operations, financial health, or future growth potential.

On Friday, the shares of Apollo Micro Systems ended 0.75% lower at Rs 91.50 apiece on NSE with a market cap of Rs 2,804.38 Cr. The stock reached a 52-week-high of Rs 147.55 on (27-Feb-2024) and a 52-week-low of Rs 87.99 on (23-Oct-2024). In addition to having a debt to equity ratio of 0.41, Apollo Micro Systems has a high and relatively expensive PE ratio of 58.76. In the last year, the market (BSE 500) has produced gains of 25.46%, while the stock has underperformed significantly, producing negative returns of -34.01%. The stock has been down over the past 5 days, resulting in a decline of -3.15%.