Multibagger defence stock Apollo Micro Systems to be in focus on Friday; here's why

Apollo Micro Systems on Thursday announced that it has entered into a definitive Share Purchase Agreement (SPA) with the promoter shareholders of Premier Explosives to acquire a 41.33% stake in the company for approximately ₹1,550 crore in an all-cash deal, subject to customary closing adjustments.

The acquisition forms part of Apollo Micro Systems' long-term strategy to build an integrated, end-to-end indigenous defence platforms ecosystem in line with the Government of India's Aatmanirbhar Bharat and Make in India initiatives.

In a regulatory filing, the company said its Board of Directors approved the execution of the Share Purchase Agreement for the acquisition of 2.2 crore equity shares of face value ₹2 each, representing 41.33% of Premier Explosives' paid-up equity share capital, from the promoter shareholders.

Following the completion of the promoter stake acquisition, Apollo Micro Systems will also make a mandatory open offer to acquire up to 26% of the fully diluted voting equity share capital from the eligible public shareholders of Premier Explosives, in accordance with SEBI takeover regulations.

The company said the acquisition will combine the complementary capabilities of both businesses in defence systems and energetic materials, enabling operational synergies, enhanced research and development (R&D), and broader participation in defence and space programmes.

This announcement comes just days after the company approved a capital-raising plan worth over ₹3,322 crore, comprising a preferential issue of equity shares and convertible warrants, while also approving an increase in its authorised share capital.

The transaction is expected to be completed during the third quarter of FY27 (by December 2026), subject to regulatory, shareholder and other customary approvals.

Upon completion of the transaction, Premier Explosives will become a subsidiary of Apollo Micro Systems and will continue to operate under its existing brand while leveraging the group's expanded scale and capabilities.

Commenting on the acquisition, Baddam Karunakar Reddy, Managing Director of Apollo Micro Systems, said, "This acquisition strengthens our nation's defence manufacturing capability and deepens our sovereign expertise in energetic materials and space programmes. Together, we are better positioned to safeguard national security interests and support our armed forces with greater scale, resilience and technological self-reliance."

Founded in 1980, Premier Explosives manufactures solid propellants for missile programmes and supplies countermeasure systems to India's defence, aerospace and mining sectors.

The company's shares resumed their winning run in April, surging 63% and snapping a three-month losing streak. The momentum continued in the following month, with the stock gaining another 4%.

The stock had come under sharp selling pressure after hitting a record high of ₹354.70 apiece, with the correction continuing through March and eroding nearly 44% of its value.

However, the stock recovered most of those losses in April alone, underscoring its strong rebound from lower levels. While the stock's short-term trend remains volatile, its long-term performance continues to be robust, with the shares still up 820% over the past three years and an impressive 2,839% over the last five years.

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Ksheera Sagar has been working as a Market Research Analyst at LiveMint for the past four years, covering stocks, commodities, and broader financial markets. In this role, he closely tracks daily market movements, corporate earnings, sector trends, and macroeconomic developments. <br><br> He has over a decade of experience in the financial services industry and has previously worked with multiple organisations, including global investment bank J.P. Morgan, bringing strong research experience into the newsroom. <br><br> During his caree...