Apollo Tyres Stocks At 52-Week High, Q1 PAT Stands At Rs. 1.9bn, Beating Estimates, Add Stocks: Top Brokerage

Stocks Apollo Tyres Limited closed at a fresh 52-week high-level today. Top brokerage firm HDFC Securities suggests to 'add' the stocks, the company's consolidated PAT stood sharply ahead of their estimates. It is a mid-cap stock with a market capitalization of Rs. 16,522.

Apollo Tyres Limited - NSE performance

The current market price of Apollo Tyres stood at Rs. 260/share on NSE, down by 2.44%, till last traded. In the last 5 days, the share price of this company has surged by 11.54% on NSE, and in the last 1 month, its share price has surged by 22.41%. In the past 6 months it has gained 27.95%, and in last 1 year its share price has gained by 22.90%.

The 52-week high level of this stock is Rs. 268.30, and the 52-week low level of this stock is Rs. 165.25.

Market capitalization	Current market price	6 Months performance	1 Year performance
Rs. 16,522 crore	Rs. 260	27.95%	22.90%

Financial results

Multinational tyre manufacturer, Apollo's consolidated PAT, at Rs. 1.9bn, was sharply ahead of our estimate of Rs. 1.1bn due to better-than-expected performance in standalone and Europe business. In Europe, revenue grew 32% YoY to Eur 155mn. Apollo continues to gain market share in Europe across all segments and work on improving its mix. Consolidated Capex for FY23 stands at Rs. 11-12bn, and includes standalone Capex of Rs. 9bn and Europe Capex of Euro 40mn. They have invested Rs. 1.25bn in Q1FY23. The company has aimed to keep net debt/EBITDA below 2x. Capacity utilisation for PCR/TBR segment stood at 85% in India, the brokerage firm informs.

Company growth

Over the last few years, Apollo has invested in R&D, brand building, and expanding its distribution network. This has in turn led to market share improvement in both India and Europe. It has recently restructured its European business, leading to a sharp increase in EBITDA margin, from 8% in FY20 to 18% in FY22. Brokerage firm HDFC Securities said, "We expect Apollo to emerge as a major beneficiary of the favourable industry dynamics in India and continue to outperform Europe, given its lean cost structure. With input costs likely to peak in Q2 and backed by industry pricing discipline, we expect Apollo's margin to gradually normalise in the coming quarters. On account of the Q1 beat, we have raised our FY23-24 estimates by 17%/6%."

Disclaimer

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