Fundamental Analysis

APL APOLLO TUBES LTD
Ticker : 533758  
BUY: ₹1051.95
Target: ₹1200




APL Apollo Tubes Ltd is one of India's leading manufacturers of branded steel products. Headquartered in Delhi NCR, the company operates ten manufacturing facilities that produce over 1,500 different types of pipes and tubes. Taking into account the company's financial performance, it reported a growth of 35.68 per cent from Rs 2,534.28 crore registered in Q1FY22, recording total revenue of Rs 3,438.55 crore in Q1FY23. Comparing the net profit for the first quarter of FY23 to the same quarter last year, it declined 28.35 per cent from Rs 168.42 crore to Rs 120.67 crore. In terms of return on capital employed (RoCE), the company outperforms its peers with a strong RoE of 17-20 per cent. The company has expressed that its long-term business strategy remains unchanged, which revolves around Capex for value-added products, innovation, market creation, and ESG. The company is confident that the 30 per cent volume CAGR over FY22 is achievable till FY25. This confidence stems from the fact that the company’s Raipur facility is on track and its product is well-received by end users. Hence, we recommend a BUY