Apollo Micro Systems Ltd is Rated Hold

Current Rating and Its Context

On 27 October 2025, MarketsMOJO revised the rating of Apollo Micro Systems Ltd from 'Buy' to 'Hold', reflecting a recalibration of the stock’s overall assessment. The Mojo Score, a composite indicator of the company’s investment appeal, decreased by 8 points from 70 to 62. This adjustment signals a more cautious stance, suggesting that while the stock retains potential, investors should consider prevailing risks and valuation concerns before committing fresh capital.

It is important to note that although the rating change occurred in late October 2025, all financial data, returns, and fundamental indicators referenced in this article are current as of 09 January 2026. This ensures that the evaluation is based on the latest available information, rather than historical snapshots.

Here’s How Apollo Micro Systems Ltd Looks Today

As of 09 January 2026, Apollo Micro Systems Ltd exhibits a mixed but generally stable profile across key investment parameters. The company operates within the Aerospace & Defense sector and is classified as a small-cap stock. Its current Mojo Grade of 'Hold' reflects a balance between promising financial trends and valuation challenges.

Quality Assessment

The company’s quality grade is assessed as average. Apollo Micro Systems has demonstrated consistent operational performance, with a notable track record of nine consecutive quarters of positive results. Operating profit has grown at an annualised rate of 35.76%, signalling robust business momentum. Additionally, net profit growth stands at an impressive 90.91%, underscoring effective cost management and revenue expansion. Operating cash flow for the year reached a peak of ₹11.83 crores, while the operating profit to interest coverage ratio is a healthy 4.70 times, indicating strong ability to service debt obligations. The dividend per share (DPS) is at its highest level of ₹0.25, reflecting a shareholder-friendly approach.

Valuation Considerations

Despite these positive fundamentals, the valuation grade is marked as very expensive. Apollo Micro Systems currently trades at a price-to-enterprise value to capital employed (EV/CE) ratio of 6.8, which is elevated relative to its own historical averages and peer group benchmarks. The return on capital employed (ROCE) is 11.4%, a respectable figure but one that does not fully justify the premium valuation. The price-to-earnings-growth (PEG) ratio stands at 2.2, suggesting that the stock’s price growth may be outpacing earnings growth, which warrants caution from value-conscious investors.

Financial Trend Analysis

The financial trend remains very positive. Over the past year, Apollo Micro Systems has delivered a remarkable 96.33% return, significantly outperforming the broader market benchmark, the BSE500, which returned 6.23% over the same period. Profit growth of 74.1% over the last year further supports the company’s strong earnings trajectory. These figures indicate that the company is successfully capitalising on growth opportunities within its sector, maintaining operational efficiency and expanding profitability.

Technical Outlook

From a technical perspective, the stock is mildly bullish. Recent price movements show a 0.51% gain on the day of analysis, with a one-month return of 5.89%. However, the three-month return has declined by 23.37%, reflecting some volatility and short-term profit-taking. The six-month return remains robust at 34.42%, indicating sustained investor interest. Year-to-date, the stock has declined by 6.52%, suggesting some consolidation after strong gains in the previous year. These mixed signals imply that while the stock retains upward momentum, investors should monitor price action closely for confirmation of trend continuation or reversal.

Implications of the Hold Rating for Investors

The 'Hold' rating from MarketsMOJO suggests that Apollo Micro Systems Ltd is currently fairly valued given its growth prospects and risks. Investors holding the stock may consider maintaining their positions to benefit from ongoing earnings growth and sector tailwinds. However, prospective buyers should weigh the premium valuation and recent price volatility before initiating new investments. The rating implies a neutral stance, recommending neither aggressive accumulation nor immediate divestment.

Summary of Key Metrics as of 09 January 2026

• Mojo Score: 62.0 (Hold)


• Market Capitalisation: Small Cap


• Operating Profit Growth (Annualised): 35.76%


• Net Profit Growth (Annualised): 90.91%


• Operating Cash Flow (Yearly): ₹11.83 crores


• Operating Profit to Interest Coverage: 4.70 times


• Dividend Per Share: ₹0.25


• Return on Capital Employed (ROCE): 11.4%


• Enterprise Value to Capital Employed: 6.8


• PEG Ratio: 2.2


• 1-Year Stock Return: +96.33%


• BSE500 1-Year Return Benchmark: +6.23%

Sector and Market Position

Apollo Micro Systems operates in the Aerospace & Defense sector, a space characterised by high entry barriers, technological innovation, and strategic importance. The company’s ability to sustain double-digit profit growth and maintain positive cash flows over multiple quarters highlights operational resilience. However, the sector’s cyclical nature and geopolitical sensitivities mean that investors should remain vigilant to external risks that could impact future performance.

Investor Takeaway

For investors, the current 'Hold' rating reflects a balanced view of Apollo Micro Systems Ltd’s prospects. The company’s strong financial trend and quality metrics are offset by a valuation that demands cautious scrutiny. Those with existing holdings may find it prudent to continue monitoring quarterly results and market developments before making significant portfolio adjustments. New investors might consider waiting for a more attractive entry point or confirmation of sustained technical strength.

Conclusion

In summary, Apollo Micro Systems Ltd’s current 'Hold' rating by MarketsMOJO, updated on 27 October 2025, is supported by a comprehensive analysis of quality, valuation, financial trends, and technical factors as of 09 January 2026. The company’s robust profit growth and market-beating returns are tempered by a valuation premium and recent price volatility. This nuanced outlook encourages a measured investment approach, balancing growth potential with risk management.

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