Motilal Oswal's research report on Apollo Tyres
APTY reported an in-line operating performance in 4QFY23. Lower interest and tax boosted adj. PAT by 2.6x YoY to INR4.1b (est. INR3.38b). Consolidated EBITDA margin expanded by 180bp QoQ to 16% (est. 15.4%), aided by healthy growth in domestic OE volumes, an ~8% QoQ decline in RM prices and lower energy prices in EU. APTY continues to focus on profitability and capital efficiency.
Outlook
We raise our FY24/FY25 EPS estimates by 5.5%/7.3% to factor in lower RM/interest costs and tax rates. Maintain Buy with a TP of INR430.
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