Nagpur: Solar Industries’ proposed acquisition of South Africa’s Omnia Holdings will take the combined entity’s revenue to up to ₹32,000 crore in FY28, managing director and CEO Manish Nuwal said on Tuesday at an investor conference call hosted by ICICI Securities.Nuwal ruled out an equity route for the $1.36 billion all-cash purchase. “We are not planning to raise any equity through any kind of dilution in any of the parent company or subsidiary. We are quite comfortable managing this acquisition through our internal accrual and debt, which can be available to Solar,” said Nuwal.Total debt, including acquisition financing, is projected at ₹10,000 crore to ₹11,000 crore by FY28 and will stay below two times earnings before interest, taxes, depreciation and amortisation (EBITDA), he said.During the investors’ call, Nuwal said the sharper gain would show on the earnings line. “If you look at ₹7,000 crores in FY28, in just two years, the EBITDA is increasing from almost ₹2,750 crores to almost ₹7,000 crores. It’s a big jump as far as EBITDA numbers are concerned,” said Nuwal.Solar expects revenue of ₹14,000 crore this fiscal and ₹16,500 crore in FY28. Omnia, which closed last fiscal at ₹13,300 crore, is expected to cross ₹15,000 crore. The combined EBITDA margin works out to 22% to 23%.Solar’s distribution presence will expand from 90 countries to more than 100 and manufacturing from 11 to over 25. Nuwal said global explosives margins were 18% to 19% against Omnia’s BME brand at 13% to 14%.When investors asked whether the purchase would pull capital away from defence, on which Solar announced a ₹12,000 crore capex programme two yea₹ back, Nuwal said, “Our focus and our capital allocation for defense will not go down. Rather, as we move forward, it is only going to go up.”The transaction is subject to regulatory and shareholder approvals, and the two companies will operate independently until it closes.
