Astra Microwave Products rallies 14% on winning Rs 386 cr order from BEL

According to analysts, the company's revenue growth is expected to be steady with an operating margin of around 19-21%, supported by a healthy order pipeline and improving geographical mix.

Shares of Astra Microwave Products (Astra) rallied 14 per cent to Rs 621.95 in Thursday's intra-day trade after the company bagged orders worth Rs 385.58 crore for supply of MPR sub-systems from Bharat Electronics Limited (BEL), Ghaziabad.

At 02:06 pm; Astra was trading 11 per cent higher at Rs 606.75, as compared to 1.3 per cent rise in the S&P BSE Sensex. The stock had hit a record high of Rs 690 on February 9.

Astra’s product portfolio spans across Defence, Aerospace & Space Electronics systems, sub-systems and components.

Last month, the company incorporated wholly-owned subsidiary Astra Space Technologies to design, development, manufacture and integration of satellites, satellite payloads, launching of satellites and establishment of ground stations for satellite tracking.

The continuous growth of India's defence sector presents vast opportunities and the same has been reiterated in the recent budget where 13 per cent of the total Union budget, amounting to Rs 6.21 lakh crore has been allocated to the Ministry of Defence for the fiscal year 2024-25. This was the highest allocation amongst all the ministries showcasing the importance placed by the government on the defence sector.

Astra’s orderbook as on December 31, 2023 stood at Rs 1,813 crore with more than 80 per cent coming from healthy margin domestic business which gives the company confidence to sustain such healthy performance in the coming future, the management said.

According to analysts, over the medium term, revenue growth is expected to be steady with an operating margin of around 19-21 per cent, supported by a healthy order pipeline and improving geographical mix.

Over the medium term, the management aims to further improve domestic revenue contribution to around 70 per cent. In addition, Astra is also focussing on expanding order intake and revenue contribution from space projects, for which, the company has set-up a wholly owned subsidiary with a dedicated team focussing on expanding space product portfolio.

Furthermore, order intake over the medium term will be supported by initiatives taken by the Government of India in recent years such as Atmanirbhar Bharath and Make in India campaigns, and announcement of positive indigenous list for Defence Products, Crisil Ratings said.