Corporate Feature     

Published: Feb 15, 2023
Updated: Feb 15, 2023

Apollo Micro Systems

Cutting-edge security solutions

Apollo Micro Systems Ltd has received a provisional allotment of land measuring 10,118 sq m for setting up an electronics unit on an Out Right Sale (ORS) basis at TSIIC hardware park PH-II in Rangareddy district (near Shamshabad International Airport, Hyderabad) by Telangana State Industrial Infrastructure Corporation Limited.

Besides, the board of directors of the company has approved the sub-division of one equity share of a face value of Rs 10 into 10 equity shares of Re 1, subject to the approval of shareholders. The record date for the sub-division of equity shares will be decided by the board. The board approved consequential alteration of the capital clause (clause V of the Memorandum of Association of the company), subject to the approval of shareholders.

Apollo’-like share surge BSE: 540879
NSE: APOLLO
CMP: Rs 361
ANALYST’S PROJECTIONS
SHORT TERM: Rs 390
POSITIONAL: Rs 600

TECH SOLUTIONS

The company is involved in the design, development and sale of high-performance, mission- and time-critical solutions for the defence, space and homeland security needs of the defence ministry, government-controlled public sector undertakings and the private sector. Apollo Micro Systems offers solutions based on state-of-the-art technologies to aerospace, defence and space clients as primary customers as well as solutions for the railways, automotive and homeland security markets. The company’s wide spectrum of technological solutions and end-to-end design, assembly and testing capabilities gives it an edge over the competition. That apart, it has participated in several indigenous missile programmes, underwater electronic warfare, underwater missiles, surface-to-air missiles, nuclear missile programmes, surface-to-surface missile programmes, indigenous submarine programmes, UAVs of both long and short endurance, ships and space programmes.

Apollo Microsystems is an electronics, electro-mechanical, engineering designs, manufacturing and supplies player. The company is certified by the Centre for Military Airworthiness and Certification (CEMIAC), whereby it is an approved design house for design and development of software and equipment for military aircraft applications. This certification is based on technical experience and past record of such authorised design houses.

A pioneer in the design, development and assembly of custom-built electronics and electro-mechanical solutions, the company has announced excellent results for the quarter and half- year ended September 30. During the half-year, the company recorded a 48% jump in revenues yoy from Rs 73.42 crore (H1FY22) to Rs 108.80 crore (H1FY23). For the corresponding period, PAT grew 47% yoy from Rs 3.33 crore (H1FY22) to Rs 4.92 crore (H1FY23). In the past one month, the stock has outperformed the market as its shares surged 25 per cent as against a 4.4 per cent decline in the S&P BSE Sensex. Moreover, in the past three months, the stock has soared 55 per cent as compared to a 7 per cent rise in the benchmark index.

RATING RISES

Recently, rating agency Acuité reaffirmed its long-term and short-term rating of Apollo Micro Systems with a ‘stable’ outlook. The rating reaffirmed a significant improvement in the business risk profile and healthy revenue growth in FY22, backed by a continued healthy operating margin. Highlighting the rationale behind the upgrade, Acuité said, “Apollo Micro Systems operates in the niche segment of the highentry-barrier defence and aerospace industry, and the client profile comprises mostly government organizations. The high entry barrier coupled with the long-term nature of contracts of the order book provides revenue visibility over the medium term. Further, AMSL’s growth prospects remain healthy, supported by the Indian government’s focus on indigenisation in the defence sector amid the ‘Make in India’ thrust.”

Apollo Micro Systems deals with reputed clientele like Bharat Dynamics Limited, Bharat Electronics Limited and Defence Research and Development Organisation (DRDO). As of June 30, 2022, AMSL has an unexecuted order book position of Rs 280 crore.