Solar Industries: Revenue CAGR seen at 43% till FY30, can the stock hit Rs 23,000 mark?

Solar Industries share price: Solar Industries India Ltd (SOIL) has strengthened its position as a leading player in India’s commercial explosives market while steadily expanding its international footprint. The company’s acquisition of Omnia Holdings is expected to deepen its presence in South Africa and neighbouring markets and provide greater backward integration in ammonium nitrate, said brokerage MOFSL.

SOIL is transitioning from being primarily an explosives supplier into a more diversified defence manufacturer. Its expansion from high-melting explosives such as HMX into ammunition, rockets and counter-drone systems reflects its strategy of moving further up the defence value chain.

The brokerage expects successful trials and commissioning of products such as Nagastra, Rudrastra and Bhargavastra to broaden SOIL’s defence revenue base beyond its existing Pinaka and HMX businesses.

Here is a look at the factors MOFSL cited behind its bullish stance on the defence industry stock.

Strong position in commercial explosives

SOIL is a leading player in India’s commercial explosives industry, with a 26% volume market share in FY25. Its product portfolio includes bulk and packaged explosives, initiating systems and blasting accessories.

The company has a wallet share of around 20-23% with Coal India and is also increasing its presence among private mining companies. Beyond the domestic market, SOIL has built an expanding international business through exports and overseas manufacturing facilities.

Omnia acquisition to weigh on near-term margins

SOIL has agreed to acquire a 100% stake in Omnia Holdings for around Rs 13,000 crore. The transaction is expected to be financed through a combination of debt and internal accruals.

However, the transaction is also expected to create a more integrated global platform and strengthen SOIL’s backward integration, particularly through Omnia’s ammonium nitrate capabilities. The brokerage estimates Omnia’s revenue could increase from around Rs 13,300 crore in FY26 to Rs 16,200 crore by FY30.

Defence portfolio expands beyond traditional explosives

SOIL has progressively expanded its defence portfolio from HMX, TMT and RDX to warheads and rocket systems, including Pinaka. The company is now also entering the unmanned systems and counter-drone segments, with Nagastra, Rudrastra and Bhargavastra forming part of its expanding product portfolio.

The company has already secured orders for Nagastra and is conducting trials for Bhargavastra. It also manufactures booster systems for the BrahMos missile and is expanding its manufacturing capabilities for 155mm ammunition.

SOIL’s defence order book and revenue grew at compound annual growth rates of 148% and 81%, respectively, between FY22 and FY26. As of June 2026, its defence order book stood at around Rs 18,000 crore, including international defence orders worth Rs 11,000 crore and a Pinaka order valued at approximately Rs 6,000 crore.

Multiple opportunities could drive defence growth

The brokerage expects SOIL’s defence business to benefit from several potential growth drivers, including additional Pinaka regiments, guided Pinaka systems, replenishment rocket orders and export opportunities.

Further opportunities could emerge from future variants of the Nagastra system, potential orders following successful Bhargavastra trials, and domestic as well as export demand for 155mm ammunition. The company is also targeting opportunities in air bombs and other defence systems for international markets.

SOIL is looking to expand into areas such as proximity fuzes, high-performance UAVs, UAS and counter-UAS systems for surveillance and defence applications.The brokerage expects defence order inflows to grow at a CAGR of around 29% between FY26 and FY30.

Backward integration to support margins

The brokerage expects SOIL’s margin profile to benefit from the increasing contribution of defence, a resilient supply chain and deeper backward integration.

Most of the company’s contracts contain price-escalation clauses, providing some protection against fluctuations in input costs. Its increasing focus on defence and exports has also been accompanied by greater in-house manufacturing of critical raw materials and components.

Financial outlook

The brokerage estimates SOIL’s consolidated revenue, EBITDA and PAT to grow at CAGRs of 43%, 36% and 34%, respectively, between FY26 and FY30.

The estimates factor in growth across the explosives and defence businesses as well as the contribution from the Omnia acquisition. The brokerage sees potential upside to its projections if SOIL secures large defence platform orders beyond those currently incorporated into its estimates or achieves greater-than-expected synergies from the Omnia acquisition.

Valuation and target price

SOIL is currently trading at around 49.1 times and 38.5 times its estimated FY28 and FY29 earnings, respectively.

Based on its projected revenue, EBITDA and PAT CAGRs of 43%, 36% and 34% over FY26-FY30, the brokerage has initiated coverage with a BUY rating and a target price of Rs 23,000, based on a 50-times multiple applied to its estimated December 2028 EPS.

Key risks

The brokerage identified delays in order inflows and slower finalisation of large defence platform orders as key risks to its estimates. SOIL’s significant exposure to African markets also leaves the company vulnerable to country-specific risks.

In addition, weaker-than-expected performance by subsidiaries and sharp movements in foreign exchange rates could affect the company’s consolidated margins and overall financial performance.

About Solar Industries 

Solar Industries is an India-based manufacturer of industrial explosives for the mining and infrastructure sector. The company offers industrial explosives and defence products.