Fundamental Analysis of Astra Microwave Products: Three promoters sensed a need for a sound, technically powerful private company that could design, develop, and produce high-end RF and Microwave subsystems and systems which resulted in the establishment of Astra Microwave Products.

In this Fundamental Analysis of Astra Microwave Products, we dive deeper into their operations, financials, future plans and more…

Company Overview

Astra Microwave Products Limited (ASML) was founded in 1991 as a Private Limited Company, and its journey has been distinguished by constant development and milestones. It became a publicly traded company in 1995. They currently have four production facilities in Hyderabad and two research and development facilities in Hyderabad and Bangalore, India.

Astra is engaged in the design, development, manufacture, and sale of high-value-added RF and microwave super components, subsystems, and system discoveries for the defense, space, telecommunications, meteorology, and civil communication industries. They have established themselves as industry leaders with a diversified range of over 500 RF equipment for both research and testing.

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They have over 26 years of experience in mass production and are supported by cutting-edge Assembly, Integration, and Test Facilities. Collaborations with different Indian Government Laboratories, Defense Public Sector Undertakings, the Indian Space Research Organization, and numerous multinational OEMs are among their previous experiences.

Business Segments

The company operates in a single product segment. Categorizing based on the business sector, we have defense, space, metrology, and exports. The sector breakup of revenue is shown in the table below.

Based on geographical segment 91% of Revenue is contributed by domestic customers and only 9% is contributed by foreign customers. 

Business SectorRs (In Crores)%
Metrology, Civil Telecom/ Others28.554
Other Operating Revenue2.121

Industry Overview

The Indian defense manufacturing industry is a crucial pillar of the country’s economy, gaining speed in response to increased national security concerns. India is regularly placed among the top importers of defense equipment over the last half-decade, purposefully positioning itself to gain technological advantages over rivals such as China and Pakistan. This trend demonstrates a proactive strategy for modernizing the armed services and reducing dependency on external defense procurement sources.

The government has played a critical role in developing a self-sufficient defense environment through numerous efforts, particularly by pushing the ‘Make in India’ campaign. These policy support programs seek to increase domestic manufacture of defense equipment, hence increasing India’s defense self-sufficiency.

As of 2021, India has the world’s third-largest defense budget, demonstrating its commitment to strengthening its national security infrastructure. Looking ahead, India’s ambitious objective of exporting equipment worth $15 billion by 2026  will establish it as a prominent player in the global defense sector.

The Union Budget for 2022–23 takes an active approach, allocating 25% of the defense R&D budget to private industry and start-ups. This strategic allocation has the potential to be a catalyst for innovation, paving the path for the development of cutting-edge defense technologies in the country. It not only reflects the government’s dedication to technological improvements, but it also establishes India as a center of innovation in the ever-changing environment of defense technologies.

Astra Microwave Products – Financials

Revenue And Profit

Consolidated Revenue from operations reported a growth of 8.7% from Rs.750.46 Crores in FY22 to Rs.815.52 Crores in FY23. The company has one customer who contributes more than 10% of total revenue amounting to Rs 192.99 Crores compared to three customers in FY222 amounting to Rs 440.72 Crores. On a 4-year CAGR basis the company grew by 29.18%.

Profit after tax reported an 84% growth from Rs. 37.87 crores in FY22 to Rs. 69.83 Crores in FY23. The company has improved its profitability compared to last FY mainly due to a change in sales mix where domestic sales have contributed more compared to the export sales. The decline in PAT in FY21 was mainly as the mix of sales skewed to exports which carries a low gross margin. On a 4-year CAGR basis the company reported 62.66%

Fiscal YearNet sales (In Crores)Net Profit (In Crores)
4 year CAGR29.18%62.66%

Profit Margins

AMPL reported a 6.22% increase in operating profit margin (OPM)  from FY22 to FY23.On a 5-year average, the OPM for the company is around 14.51%.

The Net profit margin (NPM) was reported at 9.49%, a 4.01% increase from FY22 to FY23. On a 5-year average, the NPM stands at 6.53%.

Fiscal YearOperating Profit MarginNet Profit Margin
5 year average14.51%6.53%

Return Ratios

Return on Capital Employed increased by 6.38% from 10.72% in FY22 to 17.1% in FY23. This increase is mainly due to an increase in revenue and an increase in margins. On a 5-year average basis, ROCE stands at 11.36%. 

A 4.75% increase was reported in Return on Equity from 6.62% in FY22 to 11.37% in FY23, the reason for which is an increase in the profits of the current year. The 5 year average ROE stands at 6.69%.

Fiscal YearROCEROE
5 year average11.36%6.96%

Debt Analysis

Debt/Equity has increased from 0.14 times in FY22 to 0.29 times in FY23. The average D2E is also below 2. The company has low debt creating an opportunity to borrow if required.

Interest Coverage Ratio has increased from 3.34 times to 4.1 times. On a 5-year average basis, ICR stands at 3.46 times.

Fiscal YearDebt / Equity (Times)Interest Coverage Ratio (Times)
5 year average0.163.46

Fundamental Analysis of Astra Microwave Products – Key Metrics

CMP606Market Cap(Cr)5,783.58
EPS6.42Stock P/E75.95
Promoter Holdings6.54%FII Holdings1.73%
Debt to Equity0.29P/B7.56
Operating Profit Margin18.16%Net Profit Margin9.49%

Key highlights:

  • Low debt-to-equity ratio.
  • The company’s PE is higher than the industry’s PE.
  • Promoters holding is only 6.54%

Future Outlook

  • AMPL is at the forefront of the wireless communication revolution, with a significant emphasis on research and development. Beyond radar subsystems, the company’s goal is to provide full defense and aerospace solutions that include radars, subsystems, and components. AMPL encourages collaborative efforts for joint product creation, emphasizing shared ownership and profit-sharing when working with start-ups.
  • AMPL is dedicated to developing different solutions under the Astra brand, highlighting core skills in the RF and microwave domains, to broaden their product portfolio and reach a broader market. The company aims to produce unique products using in-house knowledge and external collaborations.
  • AMPL exhibits a strong commitment to growing operations and driving improvements in RF and microwave technologies in the Defense and Aerospace sectors with a large capital expenditure of approximately Rs. 45 crore.


As we conclude this article it is worth mentioning that our government spends about close to 3% of GDP on defense every year and is highly focused on increasing self-reliance, creating great opportunities. They have chosen approximately ten projects or products in which they intend to invest aggressively and expect to see results within the next three to four years.

The biggest cause of concern is that the company’s core revenue stream is the defense industry, and the conversion of projects into significant orders primarily depends on government choices. This dynamic results in an uneven and unbalanced sales pattern, which is beyond the company’s control.

Do let us know your thoughts in the comment section below.

Written By Ashish Agarwal

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