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Informist, Tuesday, Oct. 28, 2025

By Shreya Shetty

MUMBAI - APL Apollo Tubes Ltd.'s bottom line for the September quarter is seen growing fivefold on year, boosted by record volumes and a low base. The company witnessed robust volume growth despite weak demand and a market-wide liquidity crunch, Nuvama Wealth Management Ltd. said.

The company's consolidated net profit for the September quarter is expected to be INR 2.67 billion, up over 395% on year, according to the average of estimates by five brokerage firms. The highest estimate for net profit is INR 2.76 billion by Nuvama and the lowest is INR 2.53 billion by IDBI Capital Market Services Ltd.

The jump in consolidated profit on year is due to a low base. For the September quarter last year, the company posted a profit of INR 538.1 million—the lowest in 17 quarters—due to discounts and a correction in steel prices. The company had provided an additional discount of INR 500 per tonne during the quarter to push sales amid a correction in steel prices. The company had opted for discounts to overcome the dampened sentiment of distributors and channel partners.

The company's revenue is expected to rise nearly 15% on year to INR 54.82 billion for the September quarter, according to the average of these estimates. Estimates for revenue range from INR 53.42 billion by Nuvama to INR 56.52 billion by Motilal Oswal Financial Services Ltd. The company's revenue is expected to rise over 6% from the trailing quarter while its consolidated net profit is expected to rise more than 12% sequentially.

APL Apollo Tubes Ltd.'s sales volume surged to an all-time high of 855,037 tonnes in the September quarter, up nearly 13% from 758,267 tonnes a year ago, the company said on Oct. 1. However, the contribution from the high margin 'Apollo Z' range fell to 30% from 32% from the previous quarter, IDBI Capital said. This product category includes rust-proof and coated products.

APL Apollo's earnings before interest, tax, depreciation and amortisation for the reporting quarter are likely to rise over 200% on year to nearly INR 4.20 billion for the September quarter, as per the average of estimates of the five brokerages. The steel tube maker's EBITDA is seen up nearly 13% from the trailing quarter.

The company's EBITDA per tonne is likely to triple on year to INR 4,900. Sequentially, the company's EBITDA per tonne is seen rising just 2%. This strong growth in EBITDA is owing to better operating leverage and the absence of employee stock ownership plan costs, Nuvama said. The company had issued employee stock ownership plans more than a year ago, which had accrued in the June quarter and were converted. In its analyst call for the June quarter, the company had said it would not be issuing any employee stock ownership plan in the coming 12 months.

The steel tube maker's volumes are expected to improve going ahead, along with further margin expansion, Motilal Oswal said. Market participants should monitor the company's market share gain from patra-pipes, IDBI Capital said. Patra refers to pre-cut steel plates or sheets ready for further processing. They should also watch out for details about the company's EBITDA per tonne, any update on debt, the overall capacity utilisation level, and any update on capacity expansion work and plans on entering new segments, the brokerage said.

The company will announce its September quarter earnings on Wednesday. At 1130 IST, shares of APL Apollo were up 0.7% at INR 1,778.7 on the National Stock Exchange. The stock is up 2% since Jul. 24 when the company detailed its June quarter earnings. For the June quarter, APL Apollo Tubes had reported a consolidated net profit of INR 2.37 billion on a consolidated revenue of INR 51.70 billion.

Of the 12 brokerage reports on the company available with Informist, 10 have a 'buy' or equivalent rating on the stock with an average target price of INR 1,890. The remaining two have a hold rating on the stock.

Following are the Jul-Sept earnings estimates of APL Apollo Tubes Ltd. from five brokerages in descending order of the estimate of net profit in INR million:

End

US$1 = INR 88.30

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Deepshikha Bhardwaj

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