Premier Explosives Ltd reported a significant decline in financial performance for Q1, with net profit falling 80.1% year-on-year to ₹3.1 crore compared with ₹15.3 crore in the corresponding quarter last year. According to reports from CNBC TV18, revenue declined 27.8% to ₹102.6 crore from ₹142.1 crore in the year-ago quarter, primarily due to delays in dispatches and project execution amid ongoing global headwinds and supply chain disruptions. Earnings before interest, tax, depreciation and amortisation (EBITDA) fell 71.9% to ₹5.86 crore, compared with ₹20.87 crore a year ago, with the EBITDA margin declining to 5.71% in Q1 from 14.68% in the year-ago quarter. The company's operating profit was significantly impacted by elevated raw material prices amid prevailing global market conditions.
Despite the challenging quarter, Premier Explosives maintains a strong order book of ₹1,393 crore as of the update date, with 94% contribution from the Defence segment, providing revenue visibility going forward. According to CNBC TV18, this substantial order book positions the company well for future growth once operational challenges subside. The company is engaged in manufacturing solid propellants for missile programmes and supplying countermeasure systems to the Indian defence, aerospace and mining sectors. The company expects execution momentum to improve in the coming quarters as these challenges gradually ease, providing optimism for future performance recovery.
Last month, Apollo Micro Systems Ltd entered into a Share Purchase Agreement (SPA) with promoter shareholders of Premier Explosives to acquire a 41.33% stake for ₹1,550 crore. As reported by CNBC TV18, the acquisition involves purchasing 2.22 crore equity shares of Premier Explosives with a face value of ₹2 each, with Apollo Micro Systems gaining control of the company. The transaction includes a mandatory open offer to eligible public shareholders for acquiring up to 26% of the fully diluted voting equity share capital under SEBI regulations, subject to regulatory approvals including Competition Commission of India clearance. The acquisition is expected to be completed within five months and is subject to regulatory and statutory approvals, including clearance from the Competition Commission of India (CCI) and fulfilment of conditions under the SPA.
Shares of Premier Explosives Ltd ended at ₹658.00, up by ₹6.75, or 1.04% on the BSE, despite the challenging quarterly results. According to CNBC TV18, the positive market response may reflect investor confidence in the company's strong order book position and expectations for improved execution momentum in coming quarters as operational challenges ease. The market's resilience suggests investor optimism about the company's long-term prospects despite current headwinds.
