Astra Microwave Products Ltd Q2 FY26 – The Defence Whisperer Turns Up the Frequency While the Promoters Turn Down Their Holding

1. At a Glance

Astra Microwave Products Ltd (AMPL) is that quiet Hyderabad-based tech wizard making radars, antennas, and communication systems for India’s defence and space programs — while most of us are still fighting for Wi-Fi signal in our bedrooms. The stock currently trades around ₹971 (19 Nov 2025 close), giving the company a market cap of ₹9,225 crore. In the last 3 months, it’s only down about 1.8%, which in defence stock terms is like saying “holding the fort.”

With a P/E of 57.3 and ROCE of 18.7%, Astra isn’t cheap — it’s like buying a missile guidance chip at iPhone prices. The ROE sits at 14.4%, and the company’s debt has crept up to ₹278 crore as of FY25, giving a modest debt-to-equity of 0.24. But investors seem okay paying a premium when DRDO and ISRO are your top clients.

The Bhagavad Gita says,“Karmaṇy-evādhikāras te mā phaleṣu kadācana”— you have a right to your actions, not the fruits. Astra seems to have taken this seriously: it keeps building advanced RF and microwave systems with devotion, leaving the “fruits” of P/E expansion to market karma.

2. Introduction

Imagine being the unseen hand behind India’s most sophisticated radars, missile systems, and satellites — yet no one outside Hyderabad knows your name. That’s Astra Microwave Products for you: a 1986-born silent warrior of India’s defence electronics ecosystem. While its bigger cousins like BEL and HAL get all the parade invites, Astra quietly keeps India’s electronic warfare humming at 40 GHz.

The company’s core strength? Turning electromagnetic waves into national security assets. Astra designs and manufactures RF and microwave subsystems — the kind of components that make radars see, satellites talk, and missiles aim true.

In the last few years, the company has pulled a neat strategic pivot — shifting from export-heavy to domestic-defence-heavy. Defence now makes up 65% of revenue (vs 45% in FY22), while exports have fallen from 47% to 21%. This isn’t just a shift in geography — it’s a strategic alignment with India’s “Atmanirbhar Bharat” vision, and, frankly, with where the defence budgets are exploding.

Order books don’t lie: ₹2,100 crore worth of projects as of Q1 FY25, over twice its FY24 revenue. With clients like ISRO, DRDO, L&T, and Adani Defence, Astra’s dance card is full. The only red flag? The promoters have reduced their holding to just 6.54%. Perhaps they’re too busy designing radars to track their own equity?

3. Business Model – WTF Do They Even Do?

If you ever wondered what makes a radar “see” or how a satellite “talks,” Astra Microwave is probably the one whispering the signals. The company designs, develops, and manufactures advanced RF (Radio Frequency) and microwave sub-systems. That includes antennas, transmitters, receivers, amplifiers, and integrated systems that find applications in:

• Defence:radars, electronic warfare, missile guidance.
• Space:satellite payloads, communication links.
• Telecom & Meteorology:tracking, forecasting, and broadcasting equipment.

Think of Astra as the “core brain” behind India’s electronic defence systems. Its key advantage is vertical integration — from design to manufacturing — across five factories in Hyderabad and a testing facility in Bengaluru. These aren’t your regular assembly lines; they’re electromagnetic laboratories where components are tuned to survive space and war.

Astra also partners with the big guns throughjoint ventures (JVs)— like Astra Rafael Comsys Pvt Ltd (ARC) with Israel’s Rafael Advanced Defense Systems. ARC has been a game-changer, contributing 10% of Astra’s FY24 profits and bagging a ₹286 crore Ministry of Defence order in Oct 2025.

And here’s the kicker: 37% of Astra’s workforce is in R&D. They even build GaN and GaAs MMIC chips — that’s semiconductor-level capability few Indian defence firms can match.

In short: while most companies are still “assembling” drones, Astra’s designing the waves that control them.

4. Financials Overview

Let’s decode Astra’s performance in typical desi-auditor fashion:

Annualised EPS = ₹2.52 × 4 = ₹10.08At CMP ₹971 → P/E = 96.3 (based on annualised latest quarter).

So yeah, expensive, but in the world of defence electronics — where BEL trades at 54x and Data Patterns at 73x — Astra’s valuation looks like a mid-priced missile.

Commentary:Margins are stable, order flows are strong, but quarterly volatility shows up like uninvited relatives at Diwali — especially when project-based revenue recognition is involved.

5. Valuation Discussion – Fair Value Range Only

Let’s triangulate Astra’s “educational” fair value using three methods:

(a) P/E Approach:

• FY25 EPS = ₹16.97
• Industry average P/E