Solar Industries India Limited: Powering Ahead with Record Q2 & H1 FY26 Performance

Solar Industries India Limited, a prominent player in the explosives and defense sector, has announced its unaudited financial results for the second quarter and half year ended September 30, 2025. The company has delivered a robust performance, showcasing significant growth across key financial metrics despite facing certain domestic market challenges. The management highlighted record achievements in EBITDA and PAT, underscoring the effectiveness of its strategic diversification and operational resilience.

For Q2 FY26, Solar Industries reported a turnover of INR 2,082 crores, marking a substantial 21% increase compared to the previous fiscal year. The half-year turnover reached INR 4,237 crores, registering a 25% growth. This impressive top-line growth was complemented by strong profitability, with the company achieving its highest-ever quarterly EBITDA of INR 582 crores and a Profit After Tax (PAT) of INR 361 crores. For the half-year, EBITDA stood at INR 1,146 crores and PAT at INR 714 crores. These figures reflect the company's strong financial health and operational efficiency.

Strategic Pillars: Defense and International Growth

The growth narrative for Solar Industries is strongly anchored in its defense and international business segments. The defense vertical has shown exceptional momentum, with revenue crossing INR 500 crores in Q2 and INR 900 crores in H1 FY26. This represents a remarkable year-on-year growth of 57% and 79% respectively. The company's strategic positioning as a global supply chain partner in the defense sector is evident from its robust order book, which stands at over INR 15,500 crores. The management anticipates a significant boost from the commercial sales of Pinaka rockets, expected to commence in Q3 FY26, and aims to achieve an annual defense revenue of INR 3,000 crores for FY26.

Similarly, the international business continues to be a strong growth driver. It recorded its highest-ever quarterly sales of INR 960 crores, demonstrating a 21% year-on-year growth. This performance is a testament to the company's continuous efforts to penetrate new global markets and diversify its geographical footprint. Solar Industries is actively working on operationalizing facilities in new regions like Australia, Kazakhstan, and Saudi Arabia, with these expansions expected to become operational within the next 6 to 12 months. This strategic diversification helps de-risk operations and maintain growth momentum amidst dynamic market conditions.

Navigating Challenges and Future Outlook

Despite the impressive performance, the company acknowledged challenges in the domestic market, primarily due to prolonged monsoons that impacted coal mining activities and, consequently, the demand for explosives. Macroeconomic volatility, geopolitical frictions, and tariff uncertainties also posed external pressures. Furthermore, initial complexities in ramping up defense product production were noted. However, management expressed confidence in overcoming these challenges, with expectations of improved demand from the power sector and increased mining activities in Q3 and Q4.

Solar Industries is also making significant strides in new product development. Trial production of 155 mm shells has begun, with commercial production anticipated from Q4 FY26. The company is actively developing hard kill solutions for anti-drone systems, with field trials for products like Bhargavastra expected to conclude by March 2026. These initiatives, coupled with strong government support for indigenous defense manufacturing, position the company for sustained growth.

Management reiterated its aim for an annualized growth of around 15% and expects working capital to normalize to approximately 90 days by March 2026. The total capital expenditure for FY26 is now projected to be around INR 2,000 crores, a slight deferment from the initial INR 2,500 crores due to monsoon-related delays. The company's commitment to a high-performance culture and strategic diversification ensures its adaptability and continued value creation for stakeholders.

Conclusion: Strategic Clarity and Sustained Execution

Solar Industries India Limited's Q2 and H1 FY26 results demonstrate strategic clarity and disciplined execution. The company's ability to deliver record financial performance amidst external challenges, coupled with its aggressive expansion in defense and international markets, highlights its robust business model. With new product pipelines and strong order books, Solar Industries is well-positioned to continue its growth trajectory, reinforcing investor confidence in its long-term potential.