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Informist, Thursday, Nov. 6, 2025

By Afra Abubacker

NEW DELHI – Explosives maker Solar Industries Ltd. is expected to post strong earnings for the September quarter due to robust growth in its defence and export segments. This is despite a slowdown in the domestic market, as heavy rains dampened mining and construction activity, resulting in weaker sales of industrial explosives. 

Analysts expect the company to deliver double-digit revenue growth amid significant government investments in the defence sector. The sector is well-positioned for sustained growth amid rising Budget support, Nirmal Bang Equities said. "The government's ambition extends beyond self-reliance to positioning India as a global exporter of advanced defence systems," it said. 

Solar Industries is expected to post a net profit of INR 3.53 billion in the September quarter, up around 24% on year and up over 4% from the previous quarter, according to the average of estimates from three brokerages. The estimates for net profit range from INR 3.24 billion by Centrum Broking Ltd. to INR 3.71 billion by Nuvama Wealth Management Ltd.   

The company's revenue is projected at INR 21.84 billion, up over 27% on year and over 1% sequentially, according to the average of estimates. The revenue estimates range from INR 20.55 billion by Centrum to INR 22.70 billion by Nuvama Wealth.

Centrum said defence sales are expected to surge 40% on year to INR 4.5 billion, driven by a strong order pipeline. Overseas revenue will likely grow 19% on year, but monsoon-related disruptions may have affected domestic sales due to a slowdown in mining and construction activities, it said. 

The company's revenue and net profit during FY25-FY27 are projected to grow at a compound annual growth rate of 38% and 50%, respectively, Nirmal Bang said. The robust growth expectations are backed by a healthy order book that significantly exceeds historical levels, it added. 

Defence and export businesses are set to drive 75-80% of Solar's total revenue mix over the next two to three years, up from 60-65% currently, Nuvama said. Defence is the company's fastest-growing segment, with an 82% compound annual revenue growth rate during FY21-FY25, it said. 

Of the five research reports on the company available with Informist, four have a 'buy' rating with an average target price of INR 16,758, while one has a 'hold' rating with a target price of INR 16,700. 

The company will announce its September quarter earnings on Monday. Analysts will monitor near-term catalysts such as incremental defence orders and fresh tenders from Coal India Ltd., which could further strengthen the company's order pipeline.

On Thursday, the company's shares ended 1.8% lower at INR 13,376 on the National Stock Exchange. The stock has fallen by over 10% since the announcement of its June quarter earnings.

For the June quarter, the company reported consolidated net profit of INR 3.39 billion, up 18% year on year and 5% quarter on quarter. Its revenue for the quarter was INR 21.54 billion, up 28% on year but marginally down on quarter

The following are the Jul-Sept earnings estimates for Solar Industries Ltd. from three brokerages in descending order of the estimate of net profit in INR million:

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Edited by Saji George Titus

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