The deal, at a glance

Bloomberg estimates peg the price at about 13 times earnings and under 7 times forward operating profit — a reasonable multiple for a profitable, cash-generative business rather than a turnaround.

A transformational fit

Omnia is no bolt-on. On FY26 numbers it is about 1.3 times Solar's size by revenue, and it brings a genuinely global mining-explosives platform: its BME arm offers advanced blasting technology and electronic detonators across South Africa, the wider SADC region, West Africa, Australia, Canada and Indonesia, backed by captive nitric-acid and ammonium-nitrate manufacturing that deepens backward integration. For a company whose edge has been explosives technology and low-cost Indian manufacturing, the prize is reach — access to two dozen countries into which Solar can cross-sell.

There is a margin gap to close. Omnia runs at roughly 11-12 percent EBITDA margins — well below Solar's 27-plus percent — dragged by an underperforming chemicals division. ICICI sees room for a 200-300 basis point uplift over the next few years as Omnia restructures that unit, lifts utilisation and pursues a profitability overhaul.

Scale, nearly doubled

Put together, the two would form one of the world's larger explosives platforms. On the brokerage's pro-forma FY28E maths, the combined entity's revenue nearly doubles Solar's standalone base.

The combined group would post revenue of roughly Rs 33,950 crore and operating profit near Rs 7,000 crore in FY28 — before any synergies — instantly recasting Solar from a leading Indian explosives-and-defence name into a global mining and blasting-solutions player.

The catch: interest eats the gains

Because the buyout is cash, funded largely by debt, the interest bill in the first full year very nearly wipes out Omnia's contribution to profit. On ICICI's pro-forma, combined FY28 net profit barely exceeds Solar's standalone figure.

The arithmetic is stark: Omnia adds about Rs 1,064 crore of profit, but roughly Rs 1,035 crore of fresh interest offsets nearly all of it, leaving combined profit of Rs 3,502 crore against Solar's own Rs 3,472 crore. Net debt would peak around Rs 11,000-12,000 crore, taking net-debt-to-EBITDA to about 1.6-1.7 times — elevated for Solar, but manageable. Hence the clear inflection.

What the target actually values

Because approvals are pending, ICICI has not built Omnia into its numbers; the Rs 23,500 target still rests on Solar's standalone business at 60 times FY28E earnings. That core franchise is compounding briskly in its own right.

Standalone revenue and profit are modelled to roughly double between FY25 and FY28E, with EBITDA margins holding near 27.5 percent and return on equity in the low-to-mid 30s. Solar is expected to keep spending about Rs 2,000 crore a year on defence capacity — a business ICICI expects to accelerate meaningfully from FY29, dovetailing with the Omnia inflection.

The target for investors

ICICI Securities maintains a BUY with a target of Rs 23,500, about 22 percent above the current price, valuing the standalone business at 60 times FY28E earnings. The measured way to read it: own Solar for the core defence-and-explosives compounding that already underwrites the target, and treat Omnia as a large slice of FY29-plus optionality whose value hinges on funding, integration and approval timing rather than anything visible in the next four quarters. The shares have run hard — from a 52-week low of Rs 11,641 to a high of Rs 22,700 — so accumulating into weakness, rather than chasing, is the prudent stance on a premium-multiple name.

Key risks