During Friday’s trading session, the shares of the world’s largest branded structural steel tube company and India’s leading structural steel tube manufacturer surged nearly 1 percent to hit an intraday high at Rs. 1,596.65 on BSE.
Stock Performance:
With a market cap of Rs. 42,106.03 crores, the shares of APL Apollo Tubes Limited closed in the red at Rs. 1517.20, down by nearly 1.55 percent, as against its previous closing price of Rs. 1541.15.
The stock has delivered negative returns of nearly 4.76 percent in one year, as well as around 6.57 percent returns in the last six months. So far in 2024, the shares of APL Apollo Tubes have given negative returns of about 1.06 percent.
Market Leader Position:
APL Apollo Tubes Limited is widely recognized as a market leader in the steel tube manufacturing sector in India. The company has achieved significant market dominance in the domestic market of steel construction pipes, currently holding around 55 percent of the market share in FY24.
Future Outlook & Margin Guidance:
By FY26, APL Apollo Tubes aims to continue its dominant position in the Indian Market with more than 60 percent market share. It also seeks to expand its footprint globally, targeting a 10 percent share of the overall sales.
The company has set a sales volume guidance of 4 million tons for FY26 and aims to reach 5 million tons by FY27. Margins are expected to normalize to Rs. 5,000 per ton within the next 2–3 quarters, with this level of profitability projected to remain stable throughout FY26 on a quarter-on-quarter basis.
Additionally, by FY26, APL Apollo Tubes aspires to double its revenue, achieve a 2.5x increase in EBITDA, generate over 70 percent of its revenue from value-added products, and secure more than 10 percent of sales from exports.
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Capacity & Expansion Plans:
APL Apollo Tubes currently operates at a production capacity of 4.3 million tons and is targeting an increase to 5 million tons by FY26. This expansion will require an estimated capital expenditure of Rs. 3-3.5 billion, which will be funded through internal cash flows.
To support markets in East and South India, the company is establishing new Greenfield plants in Siliguri, Gorakhpur, and Bangalore, which will collectively contribute an additional 1.5 million tons of annual capacity.
Financials:
APL Apollo Tubes reported a marginal growth in revenue from operations, experiencing a year-on-year rise of nearly 3 percent, from Rs. 4,630 crores in Q2 FY24 to Rs. 4,774 crores in Q2 FY25.
In contrast, its net profit decreased during the same period from Rs. 203 crores to Rs. 54 crores, representing a decline of nearly 73.4 percent YoY.
About the company:
Incorporated in 1986, APL Apollo Tubes Limited, the largest producer of Structural Steel Tubes in India, is engaged in the business of production of ERW steel tubes.
The company’s multi-product offerings include varieties of pre-galvanized tubes, structural steel tubes, galvanized tubes, MS black pipes and hollow sections, making APL Apollo one of the leading branded steel products manufacturers in India.
Written by Shivani Singh
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