Hyderabad-Based Defence Company Declares Q4 Results; Board To Discuss Dividend This Week

Apollo Micro Systems Ltd. is expected to be in focus on Monday after the unveiling of their Q4FY25 financial results. The company's shares plummeted close to 9% during the last trading session, which piqued the market's interest towards the quarterly performance, especially since Apollo had offered optimistic guidance during the board meeting.

The consolidated net profit for the defence and aerospace technology firm came in at Rs 13.96 crore in the fourth quarter of FY25, which reflects a growth of 8%, compared to Rs 12.93 crore they reported in the same quarter last year. There was also a sequential decline in profits, which fell 23% from Rs 18.23 crore in Q3FY25 to the current quarter.

For operational revenue, the March quarter was pegged at Rs 161.77 crore which is 19% above last year's Rs 135.44 crore but also 9% higher than the Q4FY24 business estimate of Rs 148.39 crore. As a result, EBITDA for the quarter reached Rs 35.99 crore, reflecting a 25% year-on-year increase, although this is lower than the Rs 37.79 crore target set in the previous quarter. Operational performance also remained robust, with EBITDA for the quarter rising 25% year-on-year to Rs 35.99 crore, although that is slightly below the Rs 37.79 crore reported in the prior quarter. The EBITDA margin improved to 22%, up from 21% in Q4FY24.

Apollo Micro Systems achieved a positive financial performance for FY 2024-25. Revenue and EBITDA had an impressive growth of 51.24% and 54%, respectively, with EBITDA standing at 23.5%. The net profit also grew by 81.18%, aligning with previous company projections.

In his remarks on the results, Managing Director of Baddam Karunakar Reddy stated that revenue is expected to grow at a CAGR of 45% to 50% for the next two years. This increase will occur solely from the core business and will remain unaffected by inputs from recent acquisitions. He also mentioned that there will be some margin expansion with better product mix and operating leverage in FY26, but planned capital expenditures are likely to constrain margin expansion during the second half of FY27.

Along with the earnings, the board of directors has also planned to convene on May 28, 2025, to discuss the recommendation of a final dividend for FY 2025. The proposal is subject to shareholder voting at the forthcoming Annual General Meeting.

With the exception of the recent decline in share price, Apollo Micro Systems has given stellar returns over the years. In the past month, the stock has surged 17%, and 15% since the year began, and has risen 52% over the last 6 months. Year-on-year, it is up 25%, two year figure is 309% and five year is 1585%, making it one of the top performing defence stocks under the small cap category.

Apollo Micro Systems, which came into existence in 1985 is famous for the designing as well as the manufacturing of high-end systems and electronics used in the core sectors of defence, aerospace and space. The company remains a torpedo-homing systems and underwater mines innovator, making Apollo Micro Systems a strategic partner in the Indian Defence ecosystem, highlighting the firm's continuous innovation efforts.