Defence stock with strong revenue guidance of up to ₹2,500 Cr to keep an eye on

Synopsis:
Astra Microwave Products Ltd expects strong growth with FY26 revenue of Rs. 1,150–1,200 crore, stable margins, and booking guidance of Rs. 1,000+ crore over the next two quarters, driven by key defense projects and large contract wins.

The company, specializing in the design, development, and manufacturing of RF and microwave sub-systems for defense, space, meteorology, and telecommunications, is now in focus after announcing booking guidance exceeding Rs. 1,000 crore over the next two quarters.

With market capitalization of Rs. 8,855 cr, the shares of Astra Microwave Products Ltd are closed at Rs. 932 per share, from its previous close of Rs. 944 per share.

Revenue Guidance

Astra Microwave Products Ltd has provided a multi-year revenue guidance plan projecting strong growth over the next several years. For fiscal year 2026 (FY26), revenue is expected to be in the range of Rs. 1,150–1,200 crore, with management reiterating that they are “on track” to meet these targets. 

Looking ahead, the company’s revenue plan aims for continuous growth in FY27 revenue is projected between Rs. 1,400–1,500 crore, FY28 around Rs. 1,650 crore, FY29 approximately Rs. 2,000 crore, and by FY30, revenue is expected to reach Rs. 2,250–2,500 crore. 

This growth trajectory is supported by several key projects, notably the QRSAM (Quick Reaction Surface to Air Missile), Uttam AESA radar for Tejas, Su-30 EW (Electronic Warfare) upgrades, and the Virupaksha missile program. Management expects the company to double its current size within 3–4 years and has set a long-term goal of achieving $1 billion in revenue.

Margin Guidance

Margins are expected to maintain a steady trend, with gross and EBITDA/PBT margins holding stable and a positive bias. Specifically, gross margins in FY27 and FY28 are projected to be around 45%–50%, consistent with the performance over the past two years.

Booking Guidance

For quarterly bookings, the company expects to book over Rs. 400 crore in Q3 and over Rs. 600 crore in Q4, with large orders in ARC (Annual Rate Contract) sales anticipated over 6–7 months. However, there is some inconsistency in FY sales guidance, where management mentioned amounts around $42 million (approximately Rs. 375 crore) and another figure of Rs. 250 crore during Q&A sessions. The $42 million figure has been considered operative based on management commentary, with formal clarification expected in future disclosures.

These projections highlight a strategic focus on securing high-value defense contracts and scaling up operations significantly over the next five years. The company’s focus on large project deliveries and stable margin maintenance underlines a balanced approach to growth and profitability. Formal updates and clarifications on some figures are awaited in subsequent disclosures.

About the company 

Astra Microwave Products Ltd is an Indian defense electronics company specializing in the design, development, and manufacturing of advanced radar and communication systems. Its offerings include airborne radars, electronic warfare solutions, and missile systems, catering primarily to defense forces and aerospace applications, with a focus on high-technology, precision-engineered products.

The company reports a ROCE of 18.7% and a ROE of 14.4%, with a debt-to-equity ratio of 0.24. Over the past five years, it has achieved strong profit growth, delivering a CAGR of 28.6%.

The company reported a slight decline in its financials for September 2025 on a YoY basis. Sales fell 6.5% to Rs. 215 crore from Rs. 230 crore in September 2024, while EBITDA decreased 2.8% to Rs. 47.8 crore from Rs. 49.2 crore. Net profit declined 5.9% to Rs. 23.9 crore, with EPS down 5.6% at Rs. 2.52.

Written by Manideep Appana

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