APLAPOLLO - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.5
| Stock Code | APLAPOLLO | Market Cap | 52,366 Cr. | Current Price | 1,886 ₹ | High / Low | 2,301 ₹ |
| Stock P/E | 95.7 | Book Value | 125 ₹ | Dividend Yield | 0.31 % | ROCE | 21.5 % |
| ROE | 16.7 % | Face Value | 2.00 ₹ | DMA 50 | 1,967 ₹ | DMA 200 | 1,891 ₹ |
| Chg in FII Hold | 4.40 % | Chg in DII Hold | -3.86 % | PAT Qtr | 205 Cr. | PAT Prev Qtr | 120 Cr. |
| RSI | 38.4 | MACD | -38.6 | Volume | 4,64,223 | Avg Vol 1Wk | 4,92,355 |
| Low price | 1,492 ₹ | High price | 2,301 ₹ | PEG Ratio | 42.7 | Debt to equity | 0.18 |
| 52w Index | 48.7 % | Qtr Profit Var | 35.9 % | EPS | 19.7 ₹ | Industry PE | 22.6 |
📊 Financials: APL Apollo shows solid fundamentals with ROE at 16.7% and ROCE at 21.5%, reflecting efficient capital usage. Debt-to-equity is low at 0.18, indicating a healthy balance sheet. Quarterly PAT rose to ₹205 Cr. from ₹120 Cr., showing a 35.9% variance. EPS stands at ₹19.7, highlighting steady earnings growth.
💰 Valuation: The stock trades at a very high P/E of 95.7 compared to the industry average of 22.6, suggesting significant overvaluation. P/B ratio is ~15.1 (Price ₹1,886 / Book Value ₹125). PEG ratio of 42.7 signals unsustainable growth-adjusted valuation. Intrinsic value appears lower than current price, making entry unattractive at present levels.
🏢 Business Model: APL Apollo is India’s leading structural steel tube manufacturer, benefiting from infrastructure and construction demand. Its competitive advantage lies in scale, distribution network, and product innovation. Overall health is strong, supported by profitability and low leverage, though valuation is stretched.
📈 Entry Zone: A safer entry zone would be near ₹1,500–1,650, closer to its 52-week low. Current valuation does not justify fresh entry. Long-term holding is favorable given industry demand and strong fundamentals, but investors should wait for better valuation levels.
Positive
- 📌 Strong ROE (16.7%) and ROCE (21.5%)
- 📌 Low debt-to-equity ratio (0.18)
- 📌 Quarterly PAT growth of 35.9%
- 📌 FII holdings increased (+4.40%)
Limitation
- ⚠️ Extremely high P/E ratio (95.7) vs industry average (22.6)
- ⚠️ Expensive P/B ratio (~15.1)
- ⚠️ PEG ratio of 42.7 highlights costly growth expectations
- ⚠️ Dividend yield of 0.31% is modest
Company Negative News
- 📉 Decline in DII holdings (-3.86%)
Company Positive News
- 📈 Increase in FII holdings (+4.40%)
- 📈 Consistent quarterly profit growth
Industry
- 🏦 Industry PE at 22.6, far below APL Apollo’s valuation
- 📊 Steel and infrastructure sectors benefit from rising construction demand in India
Conclusion
🔎 APL Apollo is fundamentally strong with solid profitability, low debt, and industry leadership. However, current valuations are stretched. Entry is advisable near ₹1,500–1,650. Long-term holding is favorable given industry demand, but investors should be cautious about valuation risks.
Would you like me to also prepare a valuation comparison chart between APL Apollo and steel industry peers to highlight its premium positioning?