PREMEXPLN - Prem. Explosives

📊 NSE: PREMEXPLN 🏢 Chemicals 📅 Last Updated: 12/14/2025 11:13

💰 Financial Performance

Revenue Growth by Segment

Defense & Space Services revenue grew 28% YoY in H1FY26 to INR 186.1 Cr. Commercial Explosives revenue declined 3% YoY in H1FY26 to INR 31.6 Cr. Total revenue for H1FY26 grew 22.7% YoY to INR 217.7 Cr.

Geographic Revenue Split

Exports contribute approximately 45-50% of the total top line, with domestic sales accounting for the remaining 50-55%.

Profitability Margins

H1FY26 PAT margin stood at 15.2%, showing a growth of 642 bps YoY. Q2FY26 PAT margin was 23.6%, up 1478 bps YoY. FY25 operating margin compressed to 13.9% from 21.5% in FY24 due to a 68.5% rise in expenses.

EBITDA Margin

H1FY26 EBITDA margin was 12.6%, a decrease of 548 bps YoY from 18.1%. The company targets a consolidated EBITDA margin in the range of 15-20%.

Capital Expenditure

Total assets expanded to INR 530.54 Cr in FY25 from INR 444.65 Cr in FY24, reflecting preparedness to scale up production and execution capacity.

Credit Rating & Borrowing

ICRA notes a comfortable capital structure with a gearing of 0.3 times as of March 31, 2025. Finance costs for H1FY26 were INR 1.88 Cr, down from INR 5.86 Cr in H1FY25.

⚙️ Operational Drivers

Raw Materials

Chemicals and components for explosives and defense products represent approximately 60.1% of total revenue (INR 130.96 Cr in H1FY26).

Import Sources

Raw materials and components are sourced globally, with specific challenges noted in Southeast Asia and Europe due to geopolitical tensions.

Key Suppliers

Not specifically disclosed in available documents, though marquee clients include Singareni Collieries Company Limited (SCCL), Bharat Dynamics Limited (BDL), and ISRO.

Capacity Expansion

The company is expanding its preparedness to scale up production and execution capacity in line with its long-term growth strategy, though specific MTPA figures are not disclosed.

Raw Material Costs

Cost of raw materials for H1FY26 was INR 130.96 Cr, representing 60.1% of revenue. FY25 expenses rose 68.5% YoY, compressing margins.

Manufacturing Efficiency

Capacity utilization metrics are not disclosed, but the company reported a 20% YoY revenue degrowth in Q2FY26 due to delayed order execution.

📈 Strategic Growth

Expected Growth Rate

20-44%

Growth Strategy

Growth will be achieved by executing the INR 1,297.1 Cr order book (90% defense), expanding into new propulsion systems for Guided Artillery rockets and SAM, and leveraging the JV 'Global Premier Limited' with NIBE Group to manufacture defense and aerospace products.

Products & Services

Missile propellants, ignition systems, countermeasures (chaffs and flares), booster rockets, warheads for Loitering Munition/UAVs, and PSOM XL motors for PSLV.

Brand Portfolio

Premier Explosives Limited (PEL).

New Products/Services

Development orders for propulsion systems for Guided Artillery rockets and SAM; production orders for booster rockets and warheads for Loitering Munition/UAVs.

Market Expansion

Targeting increased export orders from Southeast Asia and Europe to play a major part in future revenues.

Market Share & Ranking

Not disclosed, but noted as the only qualified Indian company for countermeasures.

Strategic Alliances

Joint Venture 'Global Premier Limited' with Global Munition Limited (NIBE Group) to manufacture defense and aerospace products.

🌍 External Factors

Industry Trends

The industry is shifting toward indigenous defense products (Atmanirbhar Bharat), presenting large growth opportunities for approved suppliers like PEL.

Competitive Landscape

Highly competitive and fragmented in commercial explosives; few private players in the specialized defense explosives segment.

Competitive Moat

Moat is sustained by technological expertise in defense explosives and being the only qualified Indian company for countermeasures, creating high entry barriers.