Apollo Micro Systems: ₹52,000-crore DAC boost in 2026

DAC clearance sets a larger backdrop for defence suppliers

Hyderabad-based defence electronics company Apollo Micro Systems Ltd (NSE: APOLLO, BSE: 540879) is being tracked as a potential beneficiary after the Defence Acquisition Council (DAC) cleared capital acquisition proposals worth about ₹52,000 crore. The clearance was announced on Friday, and it adds to the broader pipeline of procurement activity that typically feeds into programmes and sub-systems work for domestic suppliers. For companies operating in defence electronics, such clearances matter because they influence the pace at which requests, development orders, and supply contracts flow through the ecosystem.

Apollo Micro Systems operates across defence, aerospace and homeland security, focusing on mission and time critical solutions. The company’s recent disclosures and corporate actions show it is simultaneously preparing for higher order activity and adding manufacturing and product capability.

Board meeting on July 6 to consider preferential fundraising

The company has informed the BSE that a meeting of its Board of Directors is scheduled on 06/07/2026. Among the matters to be considered is preferential fundraising, which is widely tracked by investors as a route to raise growth capital.

The timing is notable because the company has already been active in raising capital through preferential issues and warrants, and it has also been expanding through acquisitions. Any fresh fundraising discussion is likely to be read alongside execution needs, working capital requirements, and the ability to bid for larger programmes as order flows accelerate.

Financial momentum and order book snapshot

Apollo Micro Systems reported strong growth indicators in its updates. The company said full-year profit rose 90% and revenue increased 61%. It also disclosed that its order book stands at ₹1,432 crore.

Quarterly disclosures cited in the provided information also show sharp growth in operating performance. In Q1FY26 (April to June 2025), revenue rose 46% year-on-year to ₹133.6 crore compared with ₹91.2 crore in Q1FY25. In Q3FY25, the company reported net sales of ₹148.39 crore, up 62.5% year-on-year, and profit after tax of ₹18.24 crore, up 83.1%.

Acquisition: IDL Explosives added through subsidiary

During the quarter ended December 31, 2025, Apollo Defence Industries Private Limited (a subsidiary) acquired a 100% stake in IDL Explosives Limited. The acquisition date was November 15, 2025, and the consideration was ₹107 crore (converted from ₹10,700 lakhs).

The transaction is positioned as a strategic move within the defence sector. With ADIPL holding 100% equity in IDL Explosives, the group expands beyond electronics into an explosives platform through an acquired entity.

Warrants and equity actions: what the filings show

The company disclosed that during the year it issued 3,80,67,058 share warrants at an issue price of ₹114 per warrant. As of March 31, 2026, 2,37,59,986 warrants had been converted into an equivalent number of equity shares of ₹1 each, fully paid up.

Separately, the company also informed exchanges about an allotment of 65,69,000 equity shares upon conversion of warrants, with the Board approving the allotment on 19 November 2025. The company said it received ₹56.16 crore as the warrant exercise amount from three investors: Mr. Baddam Kanishka Reddy, Superstar Investments Private Limited, and Mr. Srinivas Reddy Gangula.

After that conversion, Apollo Micro Systems’ paid-up share capital increased to ₹34.22 crore, representing 34,22,43,736 equity shares. The filing also noted that, with the latest allotment at that time, a total of 87,11,282 warrants had been converted into equity shares, with the remaining warrants still eligible for conversion. The deadline for converting the remaining 2,93,55,776 warrants was extended from 1 December 2025 to 30 June 2026, as permitted under authority granted by shareholders at the Extraordinary General Meeting held on 4 February 2025.

Preferential issue completion and intended use of funds

Apollo Micro Systems has also disclosed that it concluded its preferential issue of equity shares and convertible warrants, raising a total of ₹308.28 crore.

In another filing context, the company said it allotted 2.70 crore equity shares at ₹114 each, aggregating to about ₹308 crore, and issued 3.80 crore convertible warrants at the same price. It said 25% subscription amounting to ₹108.5 crore was received upfront, and the remaining ₹325.5 crore from the warrant issue was expected to be realised over the next six months. The company stated it plans to use the capital for working capital needs, innovation-driven R&D, and growth initiatives focused on high-technology, mission-critical systems.

Industrial licence: expanded manufacturing scope in Hyderabad

Apollo Micro Systems received an industrial licence approval for defence manufacturing initiatives. The stock reaction described in the provided information shows the announcement drew market attention, with the shares rising over 4% on Tuesday, December 2, and touching an intra-day peak of ₹279.50 on the BSE.

The licence was granted by DPIIT under the Ministry of Commerce and Industry and allows the company to produce advanced defence technologies at its Hyderabad facility. The company stated the licence covers production across three categories: Unmanned Aerial Systems (UAS), Inertial Navigation Systems (INS), and Radar Equipment. It also noted the licence is valid for 15 years.

Orders and exports: DRDO and PSU-linked wins

Apollo Micro Systems has reported multiple order-related updates. It said it was declared the lowest bidder (L1) for orders worth ₹25.12 crore from DRDO and Defence PSUs, which coincided with a sharp stock move where shares hit ₹233.75 in Friday’s intraday trade, up 14% on the BSE.

The company also disclosed an earlier L1 outcome for orders worth ₹7.37 crore from DRDO, as per a post-market exchange filing dated January 28. Separately, on August 4, 2025, Apollo Micro Systems said it secured its first export order valued at $13.37 million, approximately ₹113.81 crore.

Market moves investors tracked across disclosures

Several price and volume moves were cited alongside disclosures. The stock gained around 2% on Thursday, November 20 after the company announced allotment of equity shares upon warrant conversion, with the price rising as much as 2.2% to ₹285.65.

In another instance, the stock jumped 7.63% on a Thursday session, opening at ₹131.69 on the NSE and moving to an intraday high of ₹141. The information also cited a 52-week high of ₹157 and a 52-week low of ₹88.10. In August, the stock was reported to have rallied 35% during the month as it reacted to order wins and updates.

Key facts table

Why the developments matter for investors

The cluster of events around Apollo Micro Systems is centred on scale-up: a large defence procurement backdrop, a disclosed order book of ₹1,432 crore, and repeated capital market actions through equity and warrants. The acquisition of IDL Explosives via its subsidiary adds another operational line to the group, while the industrial licence expands the scope of what the company can manufacture at its Hyderabad facility.

From a market perspective, the stock reactions cited in the information set show that investors have been responding to tangible triggers: licence approvals, DRDO-linked order outcomes, and warrant conversions that directly change paid-up capital and cash inflows. The July 6, 2026 board meeting to consider preferential fundraising will be watched in that context, particularly because the company has already outlined uses of capital such as working capital, R&D and growth initiatives.

Conclusion

Apollo Micro Systems enters July 2026 with multiple moving parts: a defence procurement tailwind highlighted by ₹52,000 crore of DAC-cleared proposals, a disclosed ₹1,432 crore order book, and continuing capital actions including warrants and potential preferential fundraising. Alongside these, the IDL Explosives acquisition and the 15-year industrial licence for UAS, INS and radar equipment add to its capability stack. The next immediate milestone is the Board meeting scheduled for July 6, 2026, where the company will consider and approve items including the proposed fundraising.