Apollo Defence Industries Ltd, a subsidiary of Apollo Micro Systems, acquired IDL Explosives Ltd in an all-cash deal worth ₹107 crore. This strategic acquisition is aimed at strengthening Apollo’s position in the defence manufacturing ecosystem and expanding its portfolio into explosive-based weapon systems.
Key Highlights
- Deal Details:
- Acquirer: Apollo Defence Industries (subsidiary of Apollo Micro Systems)
- Target Company: IDL Explosives Ltd (a unit of Hinduja Group’s GOCL Corporation)
- Deal Value: ₹107 crore
- Mode: All-cash transaction
- Shares Acquired: 78.65 lakh equity shares at ₹136 each
- Ownership Post-Acquisition: 100% stake in IDL Explosives
- IDL Explosives- Company Profile:
- Established: 2010
- Core Business: Manufacturing of bulk and cartridge explosives
- Primary Clients: Mining and infrastructure sectors
- Location: Operates exclusively within India
- FY24 Turnover: ₹623 crore
- Net Worth: ₹10 crore
- Revenue Growth: Revenue rose from ₹395 crore in FY22 to ₹623 crore in FY24, reflecting robust growth.
Strategic Importance of Acquisition
- Tier-I OEM Ambition: Strengthens Apollo’s plan to become a Tier-I Original Equipment Manufacturer (OEM) in defence by integrating design, electronics, and now explosives into its manufacturing ecosystem.
- Full-Spectrum Capability: Enables end-to-end defence solutions, covering:
- Electronics
- Arming mechanisms
- Munitions
- Integrated platforms (missiles, artillery, and high-impact weapons)
- Vertical Integration: The deal marks a strategic shift into physical defence components, boosting vertical integration capabilities and reducing dependency on third-party suppliers.
- Support for ‘Atmanirbhar Bharat’: Aligned with India’s push for self-reliance in defence production under recent government initiatives.
Market Outlook
- This acquisition positions Apollo Defence Industries as a significant integrated defence player capable of delivering advanced systems for national security and export potential.
- Explosives Market Forecast:
- Expected CAGR: 8.8%
- Market Size by 2029: $9.37 billion
- Growth Drivers: Rising defence expenditure by major economies including India, US, China, Russia, UK, and France.
- Business Potential: Apollo aims to tap into emerging global and domestic opportunities in the explosives and defence weapon systems market.