Sunita Tools Limited is transforming its business model to focus on defence manufacturing and industrial capital goods, as outlined in its investor presentation for June 2026. The company, formerly known as Sunita Tools Pvt Ltd, has established a presence in the defence sector with the installation of new machinery and strategic acquisitions in the United States. This pivot aims to capitalize on the growing demand for artillery shells and aerospace-grade products, leveraging over 40 years of experience in precision engineering.

The company has completed the installation of Line 1 for artillery shell production at its Faridabad facility, which is ready for manufacturing pending a DPIIT license. This line has a capacity of 1,20,000 shells per annum. Additionally, procurement is underway for Line 2, which is planned to produce 2,40,000 shells per annum. The company is also developing advanced 155mm shells, including those with extended range and diverse payload options such as smoke and illumination.

In a significant move to expand its global footprint, Sunita Tools Limited incorporated a USA entity, Sunita Defence Inc., headquartered in Chicago. The company completed its first acquisition of New Mould Innovations (NMI) in Kentucky, a manufacturer of patented cartridges and aerospace-grade grease. The grease cartridges, featuring LeakLock™ technology, are manufactured in 14oz and 3oz sizes using 100% post-consumer recycled HDPE. The facility has the capacity to manufacture and pack over 12 million units per annum.

The investor presentation highlights the robust opportunities in the defence sector, citing a global market size of $6.8 billion with an 8% CAGR growth. India’s defence production reached ₹1.46 lakh crore in FY25, with projections to double to ₹3 lakh crore before FY29. The private sector's contribution is growing rapidly, with a projected CAGR of 25–40%, driven by government initiatives like Aatmanirbhar Bharat. Sunita Tools aims to tap into this growth through exports and domestic supply.

Future prospects include the development of complete explosives-filled shells in association with a filling company. The company is also working on Precision Guidance Kit (PGK) and Course Correcting Fuze (CCF) to enhance shell accuracy. Furthermore, the management outlined plans for developing a Loitering Weapon and acquiring Polish companies manufacturing fire brigade drones and state-of-the-art packaging machines.

Financial projections provided by the management indicate a steep growth trajectory over the next four years. Sales are forecasted to jump from ₹46 crore in FY26 to ₹636 crore in FY29. Profitability metrics are also expected to improve significantly, with PAT projected to rise from ₹6 crore to ₹102 crore in the same period. The company plans to fund its expansion through capital infusion for Line 2, business acquisitions, working capital requirements, and R&D for future opportunities.

*Subject to various conditions

Sunita Tools Limited has delivered samples, prototypes, and approved test reports for NATO Specification and Standard 155mm M107 Artillery Shells to its customer under an Interim Sales Agreement. The company also announced that its US subsidiary, Sunita Defence Inc, has secured a new order worth USD 97,632, while its legacy business has started the financial year with a healthy order book.

NATO-Grade Artillery Shell Milestone

The company has successfully delivered the required samples and prototype units of the 155mm M107 Artillery Shells, which conform to NATO Specifications and Standards. Alongside the physical samples and prototypes, Sunita Tools has also submitted various approved test reports to the customer, fulfilling the documentation and quality verification requirements under the Interim Sales Agreement. The samples were ready for some time, but delivery was delayed due to disturbances in shipping channels. The agreement will be converted to a Sales Agreement from an Interim Sales Agreement following the clearance of the prototype batch.

US Subsidiary and Business Developments

Sunita Defence Inc, a 100% subsidiary where Sunita Tools Limited holds a majority stake, received an order of USD 97,632 from a reputed Supply Chain Company in the USA. Additionally, the subsidiary has been approved as a vendor by Southern States Cooperative, a Richmond, Virginia-based farm supply and service cooperative founded in 1923. This cooperative serves over 300,000 farmer-members through 1,200 retail outlets. The company anticipates this approval will sizably increase its order book from July onwards.

Operational Outlook

The legacy business of Sunita Tools Limited has commenced the financial year well and maintains a very healthy order book for June and July. The company is currently evaluating proposals from leading professional services firms to initiate a comprehensive organizational due diligence review. Commenting on the developments, Mr. Sanjay Pandey, Chairman & Whole Time Director, stated that the samples were delivered on time and met specified quality standards, the USA acquisition is performing as expected, and the legacy business is growing according to expectations.