Apollo Micro Systems Limited announced a major business development as its subsidiary secures a substantial contract worth ₹1500 crores. The defense technology company disclosed this material information to shareholders, highlighting significant growth in its subsidiary operations.

Contract Details and Business Impact

Apollo Defense Industries Private Limited, a subsidiary unit of Apollo Micro Systems Limited, has entered into an agreement with a private company for contract execution services. The contract details are summarized below:

The company emphasized that this contract was secured through normal business operations, indicating the subsidiary's established market presence and operational capabilities in the defense sector.

Regulatory Compliance and Disclosure

The announcement was made in compliance with regulatory requirements under Regulation 30, ensuring transparency with shareholders regarding material business developments. Managing Director Karunakar Reddy Baddam signed the disclosure document, confirming the authenticity of the business update.

The disclosure serves to keep shareholders informed about significant contract wins that could impact the company's financial performance and business trajectory. This transparency aligns with corporate governance standards and regulatory obligations for listed companies.

Strategic Significance for Subsidiary Operations

The ₹1500 crore contract represents a substantial business opportunity for Apollo Defense Industries Private Limited. As a subsidiary focused on defense-related operations, this agreement demonstrates the unit's ability to secure large-scale contracts in the competitive defense sector.

The contract win reflects the subsidiary's operational strength and market positioning within the defense industry. Such significant contract values typically indicate long-term business relationships and sustained revenue potential for the organization.

Apollo Micro Systems shares surged 5% to reach the day's high of ₹272.50 on Wednesday, December 31, following the announcement of fresh orders worth ₹420.89 crores. The defence-focused company's stock performance brought it close to its upper circuit limit of ₹272.70, reflecting strong investor confidence in the latest contract wins.

Major Contract Portfolio from Coal India

The company's step-down subsidiary IDL Explosives Limited has secured significant contracts through a regulatory filing under Regulation 30. The primary contract involves a running agreement for supplying bulk explosives to subsidiaries of Coal India Limited, valued at ₹419.39 crores. Additionally, IDL Explosives received an export order worth ₹1.50 crores for cartridge explosives supply.

Recent Order Momentum

The latest contract win follows another significant announcement made last week on December 26, when Apollo Micro Systems disclosed securing an order worth ₹100.25 crores from a private company for Unmanned Aerial Systems supply, with the Ministry of Defence as the end user. This demonstrates the company's consistent ability to secure substantial orders across different defence segments.

Strategic Manufacturing Expansion

Earlier this month, the company announced a strategic greenfield expansion in Telangana aimed at scaling up its defence manufacturing capabilities. The expansion involves setting up new manufacturing facilities for missile warheads, rocket motors, and artillery systems production. This project represents one of the largest expansions undertaken by the company to enhance its capacity for both domestic and international markets.

Strong Stock Performance

Apollo Micro Systems has emerged as a multibagger performer in the small-cap defence segment, delivering exceptional returns of 125% on a year-to-date basis and an impressive 2,100% over the past five years. The company's consistent order wins and strategic expansions have contributed to sustained investor interest in this aerospace and defence sector player.