Apollo Tyres shares hit five-month high, rise 9% after healthy numbers in June quarter

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26 Aug, 2025 12:21

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Apollo Tyres share price surged as much as nine percent intraday and hit a more-than-five-month high on August 16, thanks to quarterly earnings scorecard reported by the company over the last weekend.

The stock closed at Rs 250.15 on the NSE, the highest level since March 2021, up six percent. In fact it has surpassed previous swing high in October 2021.

It saw a gap up opening on Tuesday, and formed large bullish candlestick pattern on the daily charts with robust volumes, after decisively breaking the long downward sloping resistance line adjoining March 3, 2021, October 18, 2021, and January 18, 2022.

Apollo Tyres recorded a 49 percent year-on-year growth in consolidated profit at Rs 190.7 crore for the quarter ended June FY23 despite higher input cost, aided by strong topline performance. The low base also supported the tyre maker as the Q1FY22 earnings were affected by second Covid wave.

The sequential growth in bottom line was 68 percent.

Consolidated revenue from operations grew by 30 percent to Rs 5,942 crore compared to corresponding period last fiscal, and the sequential increase was 6.5 percent.

"Both India and Europe reported strong double-digit growth in top line (YoY) helped by volume growth and price increases," Apollo Tyres said in its BSE filing.

At the operating level, EBITDA increased 22 percent year-on-year (up 10 percent QoQ) to Rs 689.8 crore for the quarter ended June FY23, but margin fell 75 bps to 11.6 percent due to significant increase in input and other costs (energy and freight). However, sequentially, the margin was up 40 bps.

While maintaining buy rating on the stock with a target of Rs 305 (implying 29 percent potential upside from Friday's closing levels), ICICI Securities said Apollo Tyres' (ATPY) Q1FY23 operating margin was in line with its estimates.

The brokerage believes improving road freight demand will increase fleet utilisation in trucking system, which in turn would enhance T&B (truck and bus) replacement demand going ahead. For Apollo Tyres, it believes cyclical reversal in demand and improving capacity utilisation in TBRs (truck and bus radial) from present 75 percent (around 1,000 TPD capacity) without need for incremental capex is likely to deliver a fresh cash flow of Rs 3,100 crore in FY23-FY24.

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