- 10 May 2023
- ICICIdirect Research
Apollo Tyres (ATL) reported healthy operational performance in Q4FY23 and was ahead of our estimates on margin front.
Apollo Tyres Ltd | CMP: 536 | Market Cap: 34,009.66
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Apollo Tyres is a leading tyre manufacturer, with operations in India (~70% of sales) & Europe (~30% of sales). Domestically company is expected to benefit from cyclical upswing in the CV space coupled with steady demand in PV domain. We continue to like the company driven by its focus towards improving profitability through industry leading price hikes; persistent RoCE ambition; judicious capex spends amidst the long-term target of achieving $5 billion revenue by FY26 & consistent focus towards deleveraging B/S as well as sweating of assets. Key monitorable would-be management commentary on capex spends post FY25E amid peak utilization levels and further margin trajectory given benign raw material prices.
Impact
Positive