- Goldman Sachs maintained a Buy rating with a target of Rs 20,180 and a strong order outlook
- Kotak Securities retained a Sell rating but raised the target to Rs 11,200 due to growth prospects
- Capacity expansion and order conversion are key to meeting the FY27 Rs 14,000 crore guidance
Solar Industries has given investors a powerful Q1FY27 growth print, but the Street remains split on what comes next.
Goldman Sachs has retained its ‘Buy' rating and Rs 20,180 target, pointing to sizable orders, higher volumes and sustained international performance, while Kotak Securities has stuck with ‘Sell' despite raising its target to Rs 11,200 from Rs 10,300.
ALSO READ: Solar Industries Q1 Results: Profit Jumps 93%, Margin Expands; Shares Hit Record High
The divide comes after Solar Industries posted its strongest-ever quarterly revenue, EBITDA, PBT and PAT, with management maintaining its Rs 14,000 crore FY27 revenue guidance and pointing to sizeable defence orders in the coming quarters.
What Brokerages Are Saying
Goldman Sachs
- Maintained ‘Buy' with a target price of Rs 20,180.
- Said Q1FY27 was ahead of estimates, with management maintaining its guidance.
- Expects sizable orders in the coming quarters.
- Sees volumes increasing following the commissioning of the Dhule plant.
- Expects robust order inflow and sustained performance from the international segment.
- Believes margins can remain at 27-28% levels.
Kotak Securities
- Maintained ‘Sell', but raised its target price to Rs 11,200 from Rs 10,300.
- Called the quarter an “all-round beat”.
- Said defence growth is being driven by Pinaka, while explosives are benefiting from high ammonium nitrate prices.
- Highlighted the Rs 21,400 crore order book as providing strong medium-term defence visibility.
- Raised EPS estimates by 2-6%, reflecting strong execution and faster-than-expected international explosives growth.
Q1 Growth Was Broad-Based
Solar Industries' consolidated net profit jumped 92.6% year-on-year to Rs 653 crore, while revenue rose 70.3% to Rs 3,668 crore. EBITDA increased 90.1% to Rs 1,015 crore, with margin expanding to 27.7% from 24.8%.
The defence business grew 123%, international explosives rose 65%, and domestic explosives increased 52% during the quarter.
Management said the defence business has an order book of more than Rs 18,000 crore and expressed confidence of securing “sizeable new orders” in the coming quarters.
Orders, Capacity To Set The Pace
MD & CEO Manish Nuwal said the company remains “firmly on track” to achieve its Rs 14,000 crore FY27 revenue guidance. The overall order book stands at more than Rs 21,350 crore, while planned capital investment is Rs 2,050 crore.
With the Dhule plant commissioned, expansions at Dholpur underway and a new facility planned in Odisha, the next leg of growth will hinge on how quickly Solar converts its order visibility and expanding capacity into volumes.
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