Apollo Tricoat Tubes surges 6%, hits new high on strong Q3 results

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Shares of Apollo Tricoat Tubes surged 6 per cent to Rs 350 on the BSE on Tuesday after it reported an impressive 86 per cent quarter-on-quarter (QoQ) jump in its net profit at Rs 17.5 crore for December quarter of the current fiscal year (Q3FY20). The home improvement innovation company had posted profit of Rs 9.4 crore in the September quarter (Q2FY20).

The company registered a healthy 49 per cent growth in revenues at Rs 229 crore backed by a strong sales volume of 47,148 MTPA. On a sequential basis, volumes improved by 71 per cent in Q3FY20.

EBITDA (earnings before interest, tax, depreciation, and amortisation) margin improved 220 basis points to 12.4 per cent from 10.2 per cent in the previous quarter. EBITDA per ton during Q3 FY20 stood at Rs 6,034, up 6 per cent QoQ.

The figures for the corresponding period last year are not comparable as the company started commercial production from June quarter (Q1FY20) onwards.

The management said the company is witnessing healthy demand for its niche product categories. Increasing contribution from the newly-launched products will not only help broaden the product mix, but will also boost sales momentum in the upcoming quarters.

In addition, the existing and upcoming product segments of Apollo Tricoat are higher margin value-added products, given their niche product applications in India. Thereby, increased portfolio of these value-added segments will further improve profitability and margins for the company, going ahead, it added.

The company is on-track to launch three other new innovative brands - Apollo Hybrid, Apollo Scaff and Apollo Alpha, which have various applications across segments including plumbing, scaffolding, green houses and for window frames.

At 09:47 am, the stock was trading 4 per cent higher at Rs 345 on the BSE, as compared to 0.12 per cent decline in the S&P BSE Sensex. The trading volumes on the counter more-than-doubled with a 132,000 shares changing hands so far, against an average 53,000 shares that were traded daily in the past two weeks.

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