- 04 Nov 2022
- ICICIdirect Research
Solar Industries registered good set of numbers for Q2FY23 despite unfavourable macros
Revenue for the quarter came in at Rs 1566.6 crore, up 98.9% YoY. Volume growth can be seen in Explosives YoY, volumes increases by 9.1% YoY, whereas realisations jumped 73.5% YoY. Accessories segment registered an improvement of 50% YoY to Rs 126 crore. Defence segment revenue came in at Rs 111 crore, up 94.2% YoY. Overseas and Exports segment revenue came in at Rs 739 crore, up 106.6% YoY
Solar continue to post good set of results led by strong growth in exports & overseas business which contributed 47% to the sales during the quarter. Moreover, demand from domestic coal sector remains better coupled with frequent price hike due to increasing Raw Material cost specially Ammonium Nitrate. Company has diversified its product portfolio and is actively looking for opportunities in Defence sector and continue to grow its Order Book from there. Its foreign subsidiaries are doing good and most of them are profitable or expected to be profitable by Q1FY24 which will boost its earnings. Company is also looking a strategic investment in North Indian based company to expand its presence in Northern part of India. Good demand from Coal sector along with product addition in defence will play good for Solar in coming years. We maintain our Bullish stance on the stock.