Analysis: Solar Industries India Limited

Growth thesis

Solar Industries produces industrial explosives for mining and defense, with defense revenue surging from ₹2,634 crores in FY26 to ₹4,500 crores guided for FY27. Defense and international business (33% of Q4 FY26 revenue) drive growth, supported by a ₹18,000 crores defense order book and 30% international revenue growth target. Capex of ₹2,050 crores in FY27 will expand domestic footprint and enable 155mm shell production (launching in 3-4 months) and Bhargavastra counter-drone trials (CY26 completion). Margins remain stable at 27-28% despite cost pressures, with working capital normalization expected in 2027. Execution risks include certification delays for new products and geopolitical risks in international markets.

Why is Solar Industries India Limited stock rising?

• Targeting defence revenue of INR4,500 crores in FY27
• Targeting total revenue of INR14,000 crores in FY27 while maintaining current margins
• Planned annual capex of INR2,050 crores for FY27
• International business expected to grow ~30% in FY27
• Expanding into new geographies: Sierra Leone, Kazakhstan, and Australia operations starting

Research report

companyname: Solar Industries India Limited ticker: SOLARINDS sector: Industrial Explosives, Initiating Systems and Defence Products Solar Industries India Limited manufactures industrial explosives, initiating systems and defence products. It was founded in 1995 in Nagpur and has spent three decades building something unusual for an Indian industrial company: control of the entire chain, from raw material intermediates like ammonium nitrate derivatives, PETN and high-energy materials (HMX, RDX...

Catalysts

capex, new product segment, geographic expansion, order book surge

Growth guidance

FY27 revenue guided at INR14,000 crores driven by defense growth (targeting INR4,500 crores) and international expansion

Management consistency

overdeliver