Solar Industries shares rise 3.5% as Motilal Oswal says ‘Buy’, sees up to 17% upside

Reports coming in for today mention that Shares of Solar Industries India rose 3.5% on September 22 after Motilal Oswal Financial Services initiated coverage on the firm with a ‘buy’ rating and a target price of Rs 23,000. The target implies an upside of around 17% from the prevailing market price. The brokerage considers Solar Industries a leader in India’s explosives market, with a diversified portfolio spanning defence products and significant order potential.

According to Motilal Oswal, Solar Industries has evolved from an explosives supplier into an integrated defence manufacturer, strengthening its position across the value chain. The firm has expanded from high-melting explosives into ammunition, rockets and counter-drone systems. The successful commissioning and trials of its advanced defence and drone systems, including Nagastra, Rudrastra and Bhargavastra, are anticipated to broaden its topline base beyond high-melting explosives and Pinaka, the brokerage stated.

“SOIL (Solar Industries) has already established a growing international footprint through exports and overseas manufacturing operations,” Motilal Oswal stated. The brokerage anticipates Solar Industries’ consolidated topline to grow at a compound annual expansion rate of 43%, while consolidated net earnings is projected to climb at a CAGR of 34% between FY26 and FY30.

Solar Industries shares closed 3.5% elevated at Rs 19,930 apiece on September 22.

Last week, the firm’s wholly owned step-down subsidiary, Solar SA Investments Proprietary, signed a definitive agreement to acquire South Africa-based Omnia Holdings for $1.36 billion. The acquisition is anticipated to strengthen Solar Industries’ presence in South Africa and neighbouring markets. Following the deal, Motilal Oswal anticipates the firm’s topline mix by FY29 to comprise 78% industrial explosives and 22% defence.

While the Omnia acquisition is likely to gain debt and weigh on returns in the near term, the brokerage anticipates the deal to establish a global platform for Solar Industries and facilitate backward integration in ammonium nitrate. Motilal Oswal estimates Omnia’s topline will gain to Rs 16,200 crore by FY30 from Rs 13,300 crore in FY26.

The brokerage additionally anticipates Solar Industries’ defence business to benefit from potential order wins, with overall order inflows projected to grow 29% between FY26 and FY30. The firm has signed an agreement with the Maharashtra government for an Anchor Mega Defence and Aerospace project in Nagpur, involving a proposed investment of Rs 12,700 crore over the next 10 years. A resilient supply chain and the firm’s backward integration capabilities are additionally anticipated to backing its expansion, Motilal Oswal stated.