Solar Industries shares experienced continued volatility, declining another 4% on Wednesday, September 16, extending their losses from Tuesday's 14% fall. The stock hit an intraday low of ₹18,480 apiece on Wednesday, bringing the total decline to nearly 20% over two sessions following the announcement of its major acquisition. The sharp decline wiped out a significant portion of market capitalisation in consecutive sessions after the company announced its $1.35 billion acquisition of South Africa's Omnia Holdings in an all-cash deal. According to CNBC TV18, the transaction involves the acquisition of 100% of Omnia's issued ordinary shares, excluding treasury shares, for a cash consideration of ZAR 134.5 per share. The stock had opened at ₹22,290 and touched an intraday high of ₹22,700 before falling to the day's low.
The acquisition is part of Solar Industries' strategy to expand its global mining business and create a global platform for commercial explosives and blasting solutions. As reported by The Hindu BusinessLine, Managing Director and Chief Executive Officer Manish Nuwal described the deal as a milestone in the company's ambition to become a global leader in explosives and blasting solutions. The deal particularly strengthens Solar Industries' presence in Africa's mining sector through Omnia's Bulk Mining Explosives (BME) business, which provides sustainable mining solutions and has an established presence across several international markets. Omnia is a South Africa-headquartered diversified group operating across mining and agriculture, with a presence in 23 countries and serving customers in more than 40 countries through over 70 distribution centres. The company reported revenue of US$1.41 billion for the financial year ended March 31, 2026. According to Business Standard, the strategic fit is at multiple levels, offering a global platform for commercial explosives and blasting solutions, enhanced market share in Australia and Indonesia, and entry into new markets such as Canada and Brazil.
A key attraction for Solar Industries is Omnia's integrated manufacturing infrastructure that will significantly strengthen vertical integration, supply security, raw material availability and operational flexibility. As reported by The Hindu BusinessLine, the acquisition is expected to bring Solar Industries the benefit of downstream integration with Omnia's ammonium nitrate manufacturing facility. The South African company manufactures a variety of nitrate products, including ammonium nitrate, a key input for industrial explosives that Solar Industries presently buys from the market. "Having ammonium nitrate, having large manufacturing presence in explosives backed up by initiating systems and down the whole services of blasting solutions definitely creates a lot of synergy benefit for Solar as a company," Nuwal explained. The transaction is expected to create one of the largest and most integrated explosives and blasting solutions platforms globally, combining Omnia's ammonium nitrate production, surface bulk explosives and blasting services with Solar's explosives, initiating systems and advanced blasting technologies.
According to The Hindu BusinessLine, the acquisition is expected to be completed in early to mid-2027. Upon successful completion, Omnia will be delisted from the Johannesburg Stock Exchange and A2X Markets. Managing Director and CEO Manish Nuwal revealed that the combined business could generate ₹32,000 crore in revenue and earnings before interest, taxes, depreciation, and amortisation (EBITDA) of ₹7,000 crore in the next two years. He added that "if both entities generate EBITDA of around ₹7,000 crore, then definitely profit after tax will be more than ₹3,500 crore in 2027-28." To put this in perspective, Solar Industries reported revenue of ₹9,838 crore and EBITDA of ₹2,750 crore in FY26. In an interaction with CNBC-TV18, management guided for revenue of ₹31,500 to ₹32,000 crore, ₹6,800 to ₹7,000 crore EBITDA, ₹6,200 crore EBIT and profit before tax of more than ₹5,000 crore for FY28. The acquisition will not affect Solar Industries' proposed ₹12,000 crore investment to expand product portfolio and manufacturing capabilities in defence, and the company intends to continue paying dividends despite additional debt. The deal remains subject to customary closing conditions, including competition approvals under relevant jurisdiction.
Despite the market volatility, analyst sentiment remains largely positive on the acquisition. As per CNBC TV18, 15 out of 19 analysts covering the stock have a 'buy' rating, three have a 'hold' rating and one has a 'sell' rating. DAM Capital has maintained its 'buy' rating with a target price of ₹22,000 per share, representing an upside of 14.3% from the previous closing price. The brokerage highlighted that the acquisition is valued at around 7.9x enterprise value (EV) / EBITDA and will be largely funded via internal accruals and debt. The significant operational and cost synergies are expected with Solar Industries' existing African operations. The acquisition will significantly expand Solar Industries' global footprint, with the combined entity expected to operate in 110 countries from about 90 countries at present, with manufacturing sites spread across 25 nations, up from 11. The deal will also provide Solar Industries an entry into the agricultural sector with Omnia's crop nutrition, biological and biosimilar products, along with a third chemicals business division. DAM Capital noted that while the acquisition is transformational, the agriculture and chemicals segment remains a key earnings monitorable, as it continues to hold strategic importance despite their impact on the overall earnings profile.
