Q2 2025 APL Apollo Tubes Ltd Earnings Call Transcript
Key Points
- APL Apollo Tubes Ltd (BOM:533758) reported a strong quarter with a significant increase in sales volume, targeting 3.2 million tons for FY25.
- The company is expanding its capacity to 5 million tons by FY26, with new plants in Siliguri, Gorakhpur, and Bangalore, which will cater to East India and the Southern market.
- The company is focusing on innovation in the structural steel space, launching specialized products for the solar power industry.
- APL Apollo Tubes Ltd (BOM:533758) is targeting a 10% quarter-on-quarter growth in sales volume, leveraging its strong distribution network and market presence.
- The company expects EBITDA margins to normalize to INR5,000 per ton over the next two to three quarters, supported by stable steel prices and operational efficiencies.
- The company faced all-time low EBITDA spreads in Q2 due to inventory losses and additional discounts offered to customers.
- There is a risk of further steel price volatility, which could impact profitability if prices fall sharply again.
- The competitive intensity in the heavy structural steel space is increasing, with new entrants like JSPL.
- Employee expenses have increased, and the company needs to manage these costs effectively to maintain profitability.
- The company has turned from a net cash position to debt due to lower EBITDA and increased CapEx in the first half of the year.
Ladies and gentlemen, good day and welcome to APL Apollo Tubes Limited Q2 FY25 conference call hosted by Yes Securities. (Operator Instructions) Please note that this conference call is being recorded. I now hand the conference over to Mr. Udit Gajiwala from Yes Securities. Thank you and over to you, sir.
Yeah, thank you. Good evening everyone. On behalf of Yes Securities, we welcome you all to the Q2 FY25 earnings conference call of APL Apollo Tubes. From the management side we have present Mr. Sanjay Gupta, Chairman and Managing Director; Mr. Deepak Goyal, Director, Operations; Mr. Anubhav Gupta, Chief Strategy Officer; and Mr. Chetan Khandelwal, Chief Financial Officer.
I'll now hand over the call to the management for your opening remarks. Thank you sir.
Thanks Udit, and thanks to Yes Securities for hosting us for our earnings call. Good evening, everyone. I welcome all of you to our quarter two FY25
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