Premier Explosives Q1 FY27 Revenue Declines 28% to ₹102.6 Cr; Order Book Strong at ₹1,393 Cr
Premier Explosives reported Q1 FY27 revenue of ₹102.6 Cr, down 28% YoY, due to dispatch delays. EBIT and net profit fell 80% each. The order book remains strong at ₹1,393 Cr, with 94% in Defense. Management expects improving performance due to easing headwinds and the Apollo Micro Systems acquisition. FY27 revenue guidance is ₹600 Cr.
The revenue and profit decline, while significant, is attributed to temporary factors like supply chain disruptions and raw material costs. The strong order book and strategic acquisition by Apollo Micro Systems provide a positive outlook, mitigating the immediate negative impact.
The company reported a significant year-on-year decline in revenue and profits for the quarter, primarily due to operational delays and increased raw material costs, which negatively impacts the financial performance.
Premier Explosives Limited reported its first quarter (Q1 FY27) results, with revenue declining by 28% year-on-year to ₹102.6 crore. The company attributed this decrease to delays in dispatches and project execution, influenced by global headwinds and supply chain disruptions. Profitability was also impacted by elevated raw material costs, leading to a decrease in EBIT by 80% to ₹4.8 crore and net profit by 80% to ₹3 crore. The EBIT margin stood at 4.7%, and the PAT margin at 3%.
Despite the short-term challenges, the company highlighted its robust order book of ₹1,393 crore, with 94% from the Defense segment. Management expressed confidence in future performance, expecting gradual easing of external headwinds and improved operational execution in the coming quarters. The acquisition by Apollo Micro Systems was noted as a significant milestone, expected to create a broader defense platform and enhance opportunities in defense programs, technology, and R&D.
During the Q&A, management clarified that other expenses had a sustainable run rate of approximately ₹9-10 crore. They anticipate gross margins to improve sequentially and are targeting an EBITDA of 15-20%. Premier Explosives is partnering with drone manufacturers for payloads and is not developing its own drone technology. The company has received several export licenses recently and expects to complete backlogged export orders this quarter, targeting ₹150-200 crore in exports for the current quarter. Orders for flares and other products are progressing, with some expected to be completed in the next 3-4 months. The company reiterated its guidance of ₹600 crore turnover for FY27. Progress is being made on an alternate raw material for landmines and loitering munitions, with DRDO tests ongoing and an estimated 6-month timeline for clearance. Capex for RDX and HMX production at Katepally is nearing completion, with water trials expected in September. The Andhra Pradesh expansion plan is awaiting government price finalization for land. The company expects further details on synergies with Apollo Micro Systems in the next quarter.
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