Apollo Micro Systems Surges 8% On Strong Growth & New Defense Orders; Q2 Results Around The Corner

Shares of Apollo Micro Systems Ltd. were up approximately 8% at the intraday high of Rs 106.50 per share. Currently, there seems to be a recovery as the stock hits the lows of Rs 65.28 and highs of Rs 161.70 in the 52-week range.

Apollo Micro Systems has recently won a number of new and significant contractual agreements with the Indian army which helps sustain the Company's presence in the defense electronics market. The firm has been able to fulfil a proprietary order of Rs 28.74 crore with Bharat Electronics Limited and the Indian Navy's CNA (OF) Pune. In addition, it was chosen by the ARDE, DRDO who managed to outsource the relevant technology for the production of rocket munition hardware of the drone system PRACHAND. Other notable orders include one with Reliable Technosystems India Pvt Ltd (Rs 5.72 crore), Economic Explosives Ltd and ARDE-DRDO (orders worth Rs 4.70 crore), with Munitions India Ltd (Rs 72.26 crore), Bharat Dynamics Limited (Rs 10.90 crore), and a development project for ASW Rocket Guided Bombs (Rs 5.73 crore). In this context, the new orders also further emphasize Apollo's in-depth experience and abiding presence in the Indian market for defence technology.

The company's financial performance over the last quarter has been quite praiseworthy according to the latest quarterly results of Apollo Micro Systems. There was a 58% increase in total income to Rs 91.80 crore in Q1FY25, with the PAT up by 410% to Rs 8.43 crore in comparison with the first quarter FY24. There was a similar improvement in the annual figures with net sales going up by 24.91% to reach Rs 371.63 crore and an increase in PAT by 66.01% to Rs 31.11 crore in FY24 compared to FY23. This growth demonstrates the competence of the ability of the company to carry out complex defence and aerospace programs with reasonable profit margins.

The company's market capital is Rs 3,065 crore in the BSE Small-Cap Index listing. Diis reentered the position in September 2024 after purchasing 26,66,460 shares or a 0.87% stake in the company. The shares have risen about 55% from their 52-week low of Rs 65.28 per share and have returned more than 1450% over a five-year time frame making it a good multibagger.

In business since 1985, Apollo Micro Systems has been a trendsetter in the areas of design, manufacture and validation of mission-critical electronics, systems and assemblies for aerospace, defence and space industries. The company undertakes a number of critical defense activities, such as the development of torpedo tracking systems and underwater mines which are indicative of its technical skill and innovative capabilities in the field.