Astra Microwave Q3 Review: Nirmal Bang Maintains 'Hold' Rating On The Stock, Lowers Target Price — Here's Why

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Nirmal Bang Report

The projections for Astra Microwave Products Ltd.'s revenue growth, gross margin, and Ebitda margin for FY25, FY26, and FY27 are as follows: 191.9%, 20.8%, and 20.2%; 43.7%, 41.2%, and 40.2%; and 25.7%, 25.3%, and 25.6%, respectively.

The company is projected to maintain profitability, bolstered by an enhanced product mix and an ongoing emphasis on higher-complexity orders. A joint venture with Manjeera Digital Systems is in a discussion phase to create a new entity focused on producing NavIC chips and GNSS devices utilizing NavIC technology. The strategic initiatives and the government's strong emphasis on "Make in India" are expected to improve the company's order book, create new opportunities, and strengthen its market position.

The stock is currently trading at a 1-year forward P/E ratio of 34.6x, surpassing its five-year average of 30.1x. We retain Hold and value Astra Microwave at 43 times Dec'26E EPS, which exceeds its five-year average price/earnings, backed by a stable order book, indicating a potential upside of 2.5%.

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