As global tensions intensify across Europe and the Middle East, and as geopolitical strains involving major powers grow, countries are rethinking how they secure their borders.
India is responding through self-reliance and the modernisation of its armed forces. In FY 2024-25, the country recorded its highest-ever defence production, valued at ₹1,50,590 crore. This marks an 18% jump from ₹1.27 lakh crore in the previous year and an almost 90% surge compared with 2019-20.
While defence is a much broader term, two segments that often go unnoticed are explosives and propellants. According to past research estimates, the propellants and explosives market stood at US$96.99 million in 2024, with an expected compound annual growth rate (CAGR) of 6.9% over the coming years. Applying this CAGR implies a projected market size of about US$144.74 million by 2030.
But from an investor’s point of view, is there any listed company that specialises in these segments? Not to be overlooked are Solar Industries India Limited and Premier Explosives.
Explosives and Propellants: 2 Companies to Watch in India
Solar Industries India Limited
Solar Industries India is a leading manufacturer of explosives and initiating systems. It has 40 manufacturing facilities, nine of which are located abroad, and a client base in over 90 countries.
As a private limited company, Solar Industries was the first to set up an integrated facility for Pinaka rockets, the first to receive a defence order for ready-to-use ammunition, and the first to develop indigenous drone-based loitering munitions.
Recently, the company successfully tested Bhargavastra, its indigenous anti-drone system, and Rudrastra, a hybrid vertical take-off and landing (VTOL) UAV.
Order Book
Regarding recent orders, by the time of reporting Q2 FY26 results, Solar Industries had a healthy order book of over ₹17,000 crore. Recently, the company and its subsidiary have bagged an order worth ₹589 crore to supply defence products over a span of four years.
Order Visibility and Coal India Synergies
Around a month ago, Coal India placed an order worth ₹1,746 crore with Solar Industries for bulk explosives, to be delivered over two years.
Two months ago, the company bagged an order worth ₹1,400 crore from an international client, which will be executed over a span of four years.
In October, it received an order worth ₹483 crore to supply bulk explosives over 24 months from South Eastern Coalfields. In the recent past, it also received an order worth ₹158 crore from the Ministry of Defence for the supply of 450 Nagastra-1R loitering munitions.
The company also has several repeat orders for UAVs and Multi-Mode Hand Grenades. Also, with the commercialisation of Pinaka orders from the third quarter, the company expects the next level of growth in its defence revenue in the coming years.
Analysing Financials
Let’s move to the financials now. In Q2 FY26, Solar Industries posted total revenue of ₹2,082 crores, a 21.3% increase on a year-on-year basis but a decline of around 3.3% on a quarter-on-quarter basis. Of the total revenue in Q2 FY26, revenue from the defence vertical crossed ₹500 crores, a 57% increase on a YoY basis, while half-yearly revenue stood at over ₹900 crores, marking a 79% YoY growth.
Net profit for the September quarter of FY26 (2QFY26) stood at ₹361 crores, up by ₹57 crores on a YoY basis and ₹8 crores on a QoQ basis. Other positives from the financials include a strong three-year return on equity of 32.6%.
Solar Industries 5-Year Financial Performance
| Particulars | FY21 | FY22 | FY23 | FY24 | FY25 |
| Sales (₹ in crores) | 2,516 | 3,948 | 6,918 | 6,070 | 7,540 |
| Operating Profit (₹ in crores) | 515 | 748 | 1,336 | 1,482 | 2,026 |
| Net Profit (₹ in crores) | 288 | 455 | 811 | 875 | 1,288 |
| EPS (₹) | 30.5 | 48.8 | 83.7 | 92.4 | 133.7 |
Price Performance
Despite delivering 26.5% returns over the last 52 weeks and around 990% returns over the past five years, the stock of Solar Industries fell 13.6% in the last six months. The reasons?
With massive returns over the last five years, Solar Industries has been a multibagger stock. Usually, after such a steep rise, one can expect profit booking as at times valuations become frothy.
The decline coincided with broader weakness in the Indian equity markets. Recently, speciality chemical and defence-related stocks faced selling pressure, and Solar Industries, being a large-cap in the commodity chemicals and explosives sector, was impacted by this sector-wide sentiment.
Premier Explosives
Established in 1980, the company offers a wide range of products in the Explosives & Accessories segment, primarily meant for the defence sector. They offer:
- Emulsion and Slurry explosives,
- Bulk Explosives
- LD cartridge explosives
- Small-dia non-permitted explosives
- Cast Boosters
- Permitted explosives
- Pillow-packs for secondary blasting;
The company also manufactures detonating fuses of various core loads. This includes:
- Plain detonators
- Electric delay detonators
- Instantaneous electric detonators
- Permitted detonators
- Amardet NoN electric shock-tube detonators
- Cord relays
Premier Explosives is a pioneer in India in the manufacturing of explosives and detonating fuse using indigenous technology. The company is also the first in the world to produce Greener NHN detonators on a commercial scale. It is also the first private company to manufacture solid propellants for missile programmes.
Order Book
Talking about the order book the company bagged a major order from the Ministry of Defence (MoD) worth ₹429.6 crore for the supply of chaffs and flares, to be delivered within 12 months. It has also received an order worth ₹7.8 crore from the MoD for the supply of countermeasures.
As of Q2 FY26, the company has reported a total order book worth ₹1,297.1 crore.
Working towards Aatma Nirbhar Bharat and to boost the Indian defence system, Premier Explosives signed a Memorandum of Understanding (MoU) with the Andhra Pradesh Economic Development Board on November 13. As per the deal, the company has proposed to invest ₹500 crore to set up a defence and aerospace product manufacturing facility.
Analysing Financials
Talking about the financials, the company reported revenue of ₹75.5 crore in 2QFY26, reflecting a 20.1% year-on-year decline and a 46.8% quarter-on-quarter decline. Of the total revenue, ₹12.4 crore came from commercial explosives, with the remainder coming from defence and space services.
The dip in revenue was due to subdued execution across both its defence & space and commercial explosives segments.
However, despite average sales, profit after tax surged. In the September quarter, the company posted a net profit of ₹17.8 crore with a healthy margin of 23.6%.
In contrast, in the same quarter of the previous financial year, net profit stood at ₹8.3 crore with a profit margin of 8.9%. This was largely supported by the recognition of purchase discounts as other income, which has masked the underlying weakness in revenue generation.
Premier explosives 5-year financial performance
| Particulars | FY21 | FY22 | FY23 | FY24 | FY25 |
| Sales (₹ in crores) | 153 | 199 | 202 | 272 | 417 |
| Operating Profit (₹ in crores) | 7 | 22 | 26 | 58 | 58 |
| Net Profit (₹ in crores) | (11) | 6 | 7 | 28 | 29 |
| EPS (₹) | (2.0) | 1.0 | 1.2 | 5.2 | 5.3 |
Price Performance
Premier Explosives shares delivered over 1,500% returns in the last five years, but in recent times, price performance has lagged. Over the past 12 months, the stock managed to deliver just 2.36%, while the six-month return stood at 5.39%.
There are multiple reasons behind the fall.
Regulatory Risks and Safety Compliance
In November 2025, the Securities and Exchange Board of India (SEBI) initiated an insider trading inquiry into the company’s stock.
Also, in April 2025, there was a major blast at its Telangana propellant and mixing plant, which killed three workers and left six injured. Following the incident, the Telangana Pollution Control Board (TGPCB) imposed closure orders on the facility, disrupting not only production and cash flows but also creating negative sentiment among investors.
Additionally, uncertainty in defence procurement cycles and mining sector demand has made investors cautious.
Solar Industries vs. Premier Explosives vs. Others
| Company | P/E | Dividend Yield (%) | ROCE (%) |
| Solar Industries India Limited | 89.52 | 0.08 | 38.13 |
| Premier Explosives | 51.83 | 0.10 | 16.88 |
| GOCL Corporation | 11.12 | 3.98 | 7.02 |
| Keltech Energies | 12.01 | 0.05 | 25.85 |
| Beezaasan Explotech | 22.75 | 0.00 | 21.11 |
Solar Industries with a very high P/E signals strong future earnings expectations, and its excellent return on capital employed (ROCE) shows efficient use of capital, despite a negligible dividend. Premier Explosives has a lower P/E but only moderate ROCE, suggesting slower efficiency and growth than Solar.
Beside the headline names, GOCL on the given parameters appears value-oriented, while Keltech and Beezasan offer healthier returns on capital with modest valuations.
Key Takeaways
From an investors’ point of view, the explosives and propellants space offers long-term potential, backed by rising defence spending and India’s push for self-reliance. Solar Industries has strong order visibility, defence-led growth, and high ROCE that perhaps justify premium valuations. However, near-term corrections are possible after sharp past gains.
In case of Premier Explosives execution recovery, regulatory clarity, and plant normalisation remain key triggers.
Overall, it is important to keep an eye on order execution, margin quality, and safety compliance.
Note: We have relied on data from www.Screener.in throughout this article. Only in cases where the data was not available, have we used an alternate, but widely used and accepted source of information.
The purpose of this article is only to share interesting charts, data points and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educative purposes only.
Rishabh Sinha is a seasoned financial content creator with over 10 years of experience in BFSI domain. His portfolio spans over 20 of India’s most trusted financial brands. Rishabh brings depth, structure, and a reader-first approach to every piece he crafts.
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