Accumulate Apar Industries; target of Rs 5418: Prabhudas Lilladher

Prabhudas Lilladher recommended accumulate rating on Apar Industries with a target price of Rs 5418 in its research report dated August 29, 2023.

Broker Research

August 30, 2023 / 12:00 IST

Accumulate

26 Aug, 2025 12:21

Volume

Todays L/H

Prabhudas Lilladher's research report on Apar Industries

We attended Apar Industries (APR) investor day, where management maintained its optimistic outlook across all its business, driven by increasing spends on infrastructure (T&D, renewables, transportation, telecom etc), product premiumization, strong exports opportunity and new product launches. Management highlighted 1) Conductors segment growth will be driven by increasing adoption of premium products in domestic market (AL59, OPGW, HTLS), while exports market will continue to witness demand for conventional products in near to medium term, 2) Cables segment, will continue with its growth momentum driven by strong growth in Elastomeric/E-beam cables from renewables & defence sector, 5G rollouts and growth in B2C business and 3) Speciality oil segment growth will be driven by growth in Transformer Oil (T-Oil - ~33% of segment revenue). We believe, APR’s focus towards value added products and strong traction in exports business will drive strong topline and profitability in the long run.

Outlook

The stock is currently trading at PE of 32.9x/26.5x/22.2x FY24/25/26E. We roll forward to Sep’25E and maintain ‘Accumulate’ rating on stock, with revise SoTP of Rs5,418 (Rs4,100 earlier) valuing Conductors/Cables/Speciality Oil segment at 25x/32x/12x Sep25E (21x/27x/10x FY25E earlier), factoring multiyear growth visibility and evolving product mix in cables and conductors business while T-Oil to continue its improved performance. However, given the recent sharp run-up in stock price, we expect returns to be back ended.

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