APL Apollo Tubes Limited — Credit Ratings, 04-03-2025: Credit Rating- Others

The consolidated financials for APL Apollo Tubes show a total operating income of ₹18,082 crore, representing a year-over-year growth of approximately 11.78%. This growth is likely driven by healthy demand, particularly in the infrastructure and construction sectors, coupled with higher sales volumes expanding by roughly 14.87% in FY24.

Net profit for the same period stands at ₹732 crore, a notable increase from ₹642 crore in the previous year, translating to an Earnings Per Share (EPS) of approximately ₹19. The company's profitability gains may be influenced by operational efficiencies and stable margins, although recent raw material price volatility has posed some risks.

Operational costs have slightly increased, marked by a decrease in PBILDT per tonne to around ₹4,500 due to lower realizations. This reflects challenges in maintaining cost efficiency amidst rising operational expenses, although the working capital cycle has improved significantly.

The balance sheet remains robust with an overall gearing ratio of 0.33x, a slight increase but still comfortable. The liquidity position is strong, underpinned by healthy gross cash accruals of ₹915 crore and total cash and liquid investments around ₹547 crore, which supports ongoing capex in new plants.

The outlook for APL appears positive, bolstered by strategic expansions and strong management experience, despite competitive pressures and raw material volatility. Therefore, a buy insight is warranted given the company’s solid growth prospects and financial health.