The Nifty India Defence Index has surged approximately 20% over the past year, reflecting a robust performance across the sector. Leading the charge, Garden Reach Shipbuilders and Mazagon Dock each saw gains of 41% and 38%, respectively, while Bharat Electronics and Bharat Dynamics also delivered strong returns of 38% and 31%. Yet, two companies have truly stood out, tripling investor returns through a combination of strategic acquisitions, aggressive expansion, and innovative product development.
**Apollo Micro Systems: The Rise of a Tier-I Defence Manufacturer**
Apollo Micro Systems, a pioneer in high-performance, mission-critical defence solutions, has cemented its position as a key player in India’s defence sector. The company specialises in the design and manufacturing of electronic, electromechanical, and engineering systems that serve as the “brain,” “nerves,” and “eyes” of advanced weaponry, including missiles and naval systems.
A pivotal moment for Apollo came in May 2025 with the acquisition of IDL Explosives for ₹1.1 billion. This move provided backward integration into propellants and warheads, transforming Apollo into a fully integrated Tier-I defence equipment manufacturer. IDL’s FY24 turnover of ₹6.2 billion is expected to more than double Apollo’s consolidated revenue base, which stood at ₹5.6 billion in FY25.
Apollo has also forged strategic partnerships across the defence ecosystem, signing MoUs with Munitions India, Tata Consulting, Bharat Dynamics, Garden Reach Shipbuilders, and Bharat Electronics. Additionally, it has entered into a consortium agreement with Redon Systems for loitering munitions and formed a strategic partnership with Troop Comforts for advanced air defence systems.
To meet rising demand, Apollo is expanding its production capacity with Phase Two of its ongoing investment set to commence operations in Q2FY26. The company has also allocated ₹1 billion for R&D in FY26, focusing on innovations such as short-range rockets, anti-submarine warfare rockets, and delivery cargo drones.
Financially, Apollo has demonstrated impressive growth, with revenue increasing 47.3% year-over-year to ₹1.3 billion in Q1FY26. EBITDA grew by 83%, with margins expanding 600 basis points to 31%, while profit after tax (PAT) rose 110% to ₹190 million. In FY25, revenue increased by 51.2% to ₹5.6 billion, and PAT rose 78% to ₹570 million. With a current order book of ₹7.3 billion, Apollo expects revenue to grow at 45-50% annually in FY26 and FY27.
However, Apollo’s share price has surged 202% in the last year to ₹337, trading at a price-to-earnings multiple of 165x, making it the most expensive defence stock in the market.
**Axiscades Technologies: A Vision for Non-Linear Growth**
Axiscades Technologies, a leader in aerospace, defence, and ESAI (Electronics, Semiconductor, and Artificial Intelligence) solutions, has set an ambitious goal to grow its topline by 9x by FY30. The company supports aircraft manufacturers and their Tier 1 suppliers throughout the product life cycle, from design to maintenance, and specialises in mission-critical defence systems.
In Q1FY26, Axiscades reported a 9% year-on-year revenue increase to ₹2.4 billion, with its core segment (aerospace, defence, and ESAI) growing 17% to ₹1.8 billion. EBITDA increased 9% to ₹340 million, with margins steady at 14%, while PAT surged 23.5% to ₹210 million. The company’s order book, including forecast visibility, stands at ₹30 billion, with ₹12.6 billion executable in FY26 and ₹18.3 billion in FY27.
Axiscades’ long-term vision is to become a product-driven, non-linear technology leader in its core domains, aiming to reach $1 billion in revenue by FY30 through its “Power 930” strategy. In the medium term, the company targets consistent 40% growth in core revenue and profits.
As the defence sector continues to evolve, both Apollo Micro Systems and Axiscades Technologies exemplify the potential for innovation and growth in India’s defence industry. Their strategic moves and ambitious visions are not only reshaping their own trajectories but also setting new benchmarks for the sector as a whole.