APLAPOLLO - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 3.4

Let’s dig into the structure behind APL Apollo’s fundamentals — a steel tube giant with a commanding presence in infrastructure and construction.

🏗️ Core Financials Evaluation

Profitability & Returns

ROE: 19.4% and ROCE: 22.8% — commendable performance; reflects strong return on capital and equity.

EPS ₹28.9 relative to CMP indicates reasonable profitability for its segment.

PAT dropped from ₹293 Cr to ₹237 Cr, but Qtr Profit Variation: +22.8% — possibly due to base-effect or sector cyclicality.

Debt & Liquidity

Debt-to-equity: 0.15 — comfortably low, suggesting strong balance sheet.

Dividend Yield: 0.36% — consistent but modest; not a key income stock.

💸 Valuation Metrics

Metric Value Commentary

P/E Ratio 52.5 Significantly above Industry PE of 23.8 — suggests expensive valuation

P/B Ratio ~9.97 Premium vs. Book Value ₹152 — likely driven by growth expectation

PEG Ratio 7.58 Very high — indicates aggressive pricing beyond justified earnings growth

Intrinsic Value ❌ Likely below CMP Needs stronger growth to justify current levels

🧠 Business Model & Competitive Edge

APL Apollo Tubes leads the structural steel tube space, offering lightweight construction solutions.

Fast-mover in product innovation and volume scale — a strategic moat in the fragmented steel segment.

Increased FII Holding (+1.27%) and stable DII Holding (+0.09%) signal moderate institutional optimism.

📉 Technical Pulse

RSI: 25.7 — deeply oversold, suggesting possible short-term reversal.

MACD: -55.0 — bearish momentum persists.

Current Price ₹1,515 is below DMA 50 (₹1,704) and DMA 200 (₹1,620) — technical weakness is evident.

52W low: ₹1,253, high: ₹1,936 — current price near lower end of range.

📍 Entry Zone & Long-Term Strategy

Entry Zone: ₹1,450–₹1,500 — oversold RSI + proximity to recent support zone makes this attractive.

Long-term investors may consider accumulating gradually, but valuation must be monitored closely due to elevated PEG and P/E levels.

Sector tailwinds (infra push, urbanization) support the broader story — provided execution and margin expansion continue.

Would you like me to sketch a sector overview or map out valuation trajectories for similar industrial plays like Tata Steel or Jindal Saw? Happy to help build your steel strategy 🔩📈.

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