Apollo Pipes Share Rises 6% to New High on Health Outlook, Up 42% in 2023

Apollo Pipe (APL) shares climbed 6% in slow intraday trade on Thursday to a new BSE high of Rs 718.70, citing a good business outlook. At 2:40 pm, the S&P BSE Sensex was 63,038—0.17% down.

The S&P BSE Sensex has gained 3% while the stock has grown 42% in 2023.
APL makes PVC, ring, and self-assembling pressure pipes, column pipes, casings, pipes, soil-wastewater-stormwater pipes, fittings, and tanks.

The government’s effort for cleanliness and sanitation to enhance the water resources management industry, affordable home building, and rising demand for housing, irrigation, and water supply infrastructure are the main growth factors.

APL anticipates the Indian PVC pipes and fittings market to increase 15%.

APL reported 17% revenue increase in FY2023, led by volume growth of 24% but a year-on-year reduction owing to lower PVC resin pricing.

In FY23’s second and third quarters, inventory losses from PVC resin price corrections hurt profitability. Ebitda margin dropped from 12.1% in FY22 to 7.5% in FY23.

Management expected the government’s pro-growth actions, notably in the rural, infrastructure, and agriculture sectors, to boost domestic demand and consumption of the company’s products in the medium to long term.
Management is optimistic in exploiting the untapped high-potential markets of central and eastern India, underpinned by predicted good industrial growth trends.