Solar Industries India Ltd. share price forecast

Solar Industries’ (Solar) Q2FY23 consolidated EBITDA of Rs299bn (up 127% YoY) was ahead of street’s estimates by 32%.

Solar Industries’ (SOIL) earnings surprised on the back of higher-than-expected domestic volumes and margins. SOIL has been able to pass through the RM price increase, leading to improved gross margins/te and EBITDA margins/te QoQ. FY22 volume growth of 22% (vs guidance of 20%) along with improvement in gross margins in an inflationary environment where ammonium nitrate prices have increased ~3x highlights the pricing power that SOIL enjoys.

Background: Established in 1995, Solar Industries is the largest manufacturer of industrial explosives and explosive initiating systems in India and has the world's largest manufacturing facility for packaged explosives. With a licensed explosives capacity of over 290,000 MT/annum, the company has ~28% market share in India. Solar, with a 70% market share in exports from India, exports to 51 countries around the world. Economic Explosives, a 100% subsidiary, manufactures detonators. In recent years it has expanded its manufacturing base to Nigeria, Zambia, South Africa, Turkey, Ghana and Australia. SIIL also has interests in the coal...

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Background: Established in 1995, Solar Industries is the largest manufacturer of industrial explosives and explosive initiating systems in India and has the world's largest manufacturing facility for packaged explosives. With a licensed explosives capacity of over 290,000 MT/annum, the company has ~28% market share in India. Solar, with a 70% market share in exports from India, exports to 51 countries around the world. Economic Explosives, a 100% subsidiary, manufactures detonators. In recent years it has expanded its manufacturing base to Nigeria, Zambia, South Africa, Turkey, Ghana and Australia. SIIL also has interests in the coal...

Background: Established in 1995, Solar Industries is the largest manufacturer of industrial explosives and explosive initiating systems in India and has the world's largest manufacturing facility for packaged explosives. With a licensed explosives capacity of over 290,000 MT/annum, the company has ~28% market share in India. Solar, with a 70% market share in exports from India, exports to 51 countries around the world. Economic Explosives, a 100% subsidiary, manufactures detonators. In recent years it has expanded its manufacturing base to Nigeria, Zambia, South Africa, Turkey, Ghana and Australia. SIIL also has interests in the...

It also leads the exports share from India, which is around 70% in industrial explosive and initiating system It exports to 51 countries in the world and has recently expanded its...

Background: Established in 1995, Solar Industries is the largest manufacturer of industrial explosives and explosive initiating systems in India and has the world's largest manufacturing facility for packaged explosives. With a licensed explosives capacity of over 290,000 MT/annum, the company has ~28% market share in India. Solar, with a 70% market share in exports from India, exports to 51 countries around the world. Economic Explosives, a 100% subsidiary, manufactures detonators. In recent years it has expanded its manufacturing base to Nigeria, Zambia, South Africa, Turkey, Ghana and Australia. SIIL also has interests in the...

Explosives volume rose 13% whereas realisations jumped 25%. As a result, overall explosives segment revenue leaped 42% YoY to | 418 crore. Accessories segment registered an improvement of 52% YoY to | 111 crore. Defence segment revenue came in at | 19.54 crore, down 26% YoY. The segment struggled as there were some disruptions with respect to new order processing and execution of existing ones owing to Covid-19. Going ahead, the defence segment should start firing up with the | 680 crore order book and bulk clearance order for multi-mode hand grenade....

Background: Established in 1995, Solar Industries is the largest manufacturer of industrial explosives and explosive initiating systems in India and has the world's largest manufacturing facility for packaged explosives. With a licensed explosives capacity of over 290,000 MT/annum, the company has ~28% market share in India. Solar, with a 70% market share in exports from India, exports to 51 countries around the world. Economic Explosives, a 100% subsidiary, manufactures detonators. In recent years it has expanded its manufacturing base to Nigeria, Zambia, South Africa, Turkey, Ghana and Australia. SIIL also has interests in the...

Background: Established in 1995, Solar Industries is the largest manufacturer of industrial explosives and explosive initiating systems in India and has the world's largest manufacturing facility for packaged explosives. With a licensed explosives capacity of over 290,000 MT/annum, the company has ~28% market share in India. Solar, with a 70% market share in exports from India, exports to 51 countries around the world. Economic Explosives, a 100% subsidiary, manufactures detonators. In recent years it has expanded its manufacturing base to Nigeria, Zambia, South Africa, Turkey, Ghana and Australia. SIIL also has interests in the...

Background: Established in 1995, Solar Industries is the largest manufacturer of industrial explosives and explosive initiating systems in India and has the world's largest manufacturing facility for packaged explosives. With a licensed explosives capacity of over 290,000 MT/annum, the company has ~28% market share in India. Solar, with a 70% market share in exports from India, exports to 51 countries around the world. Economic Explosives, a 100% subsidiary, manufactures detonators. In recent years it has expanded its manufacturing base to Nigeria, Zambia, South Africa, Turkey, Ghana and Australia. SIIL also has interests in the...

SIL's Q2FY21 performance was largely the result of its all-time high revenue from overseas & exports with business in Turkey returning to normal whereas commencement of Ghana operations further aided the performance. During the quarter, exports came in at | 81 crore and overseas at | 393 crore. Ex-new geographies, O&E; segment grew 18% YoY. Going ahead, SIL plans to add a few more markets to its overseas portfolio whereas in existing markets, the company plans to increase market share in South Africa (market size of US$700 million with SIL's share being 2.5%) & Australia...

Company reported poor Q1FY21 due to subdued economic activity in the global as well as domestic market. Explosives sales volume declined by 24.0% YoY to 70,287 MT (vs 92,531 MT in Q1FY20) while realization declined by 7.0% YoY to INR 34,238/MT (vs INR 36,969/MT). Exports and overseas revenue contribution in Q1FY21 rose to 42.2% of revenue (vs ~31.5% in Q1FY20) and saw a growth of 6.0% YoY (+19.2% QoQ). Housing and Infra declined by 49.3% YoY (-34.1% QoQ, 22% of revenue), revenue from Coal India declined 10.4% YoY (-7.5% QoQ, 20% of revenue), Institutional revenue declined ~32.2% YoY (-30.7% QoQ, 10% of revenue), defense revenue declined 7.1% YoY (-11.4% QoQ, 5% of...