Apollo Micro Systems hits upper circuit after bagging army contract
What's the story
Apollo Micro Systems, a leading defense and aerospace company, has secured a significant contract from the Indian Army.
The Make II project involves the procurement of a Vehicle Mounted Counter Swarm Drone System (VMCSDS).
This is the first such project for Apollo Micro Systems, which stated that there would be no cost involvement in this endeavor.
The company described the project as "very prestigious" and "the first Make II project for the company."
Market impact
Stock soars following Apollo Micro Systems's contract announcement
Following the announcement of the contract, Apollo Micro Systems' shares saw a significant surge in morning trading.
The stock opened with an upside gap at ₹109.76 per share on the National Stock Exchange (NSE) and quickly hit the 5% upper circuit.
Despite today's surge, it's worth noting that this defense component maker's stock has declined over 3% so far this year in comparison to Nifty's 13% surge.
Financials & Timeline
Apollo Micro Systems's financial performance and project timeline
Despite the stock's overall decline this year, Apollo Micro Systems has seen a significant increase in revenues and profits.
The company reported a 26.7% on-year rise in revenues for the March-ended quarter, while profits soared by 79.3% YoY.
Operating income also rose by 38% YoY in Q4FY24.
As for the Make II project timeline, the company expects to execute the order within "85 weeks for single stage composite trials and staff evaluation."
Company profile
Apollo Micro Systems's expertize and market presence
Apollo Micro Systems specializes in the design, development, and manufacturing of mission-critical electronic systems and subsystems for aerospace, defense, space, and homeland security applications.
The company's product range includes high-performance embedded computing systems, ruggedized computers, electronic systems for missile applications, avionics systems, among others.
Listed on both BSE and NSE with a market cap of ₹3,364 crore ($450 million), Apollo Micro Systems is a significant player in the defense sector.