In This Article:
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Consolidated Revenue: INR69.3 billion, 5% growth year-on-year, 8% sequential growth.
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Consolidated EBITDA: INR9.5 billion, margin of 13.7%.
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Net Debt Reduction: INR4.5 billion reduction as of December 2024.
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Net Debt to EBITDA Ratio: 0.7x for consolidated operations.
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India Revenue: INR45.4 billion, 5% growth year-on-year.
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India EBITDA: INR5 billion, margin of 11.1%.
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Net Debt to EBITDA Ratio (India): 1.4x.
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Europe Revenue: EUR181 million, 3% growth year-on-year, 6% sequential growth.
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Europe EBITDA: EUR32 million, margin of 17.7%.
Release Date: February 07, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Apollo Tyres Ltd (BOM:500877) achieved a consolidated top-line growth of 8% quarter on quarter and 5% year-on-year, despite challenges in raw material costs.
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The company maintained a consolidated EBITDA margin of 13.7%, similar to the previous quarter, indicating effective cost control measures.
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Apollo Tyres Ltd (BOM:500877) outperformed the industry in the domestic PCR and agri-replacement segments, resulting in market share gains.
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In Europe, the company registered a 7% growth in the replacement segment revenues and improved its product mix by more than 400 basis points.
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The company is focusing on expanding its presence in the US and Middle East markets, with a particular emphasis on Saudi Arabia, indicating strategic growth initiatives.
Negative Points
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The domestic growth was partially offset by a marginal decline in the OEM segment, impacting overall performance.
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Interest costs in India increased due to working capital borrowings, reflecting profitability challenges and a weaker market.
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The company's export growth was flat, with some peers performing better in this area, indicating potential areas for improvement.
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Gross margins contracted by 300 basis points in the India standalone numbers for Q3, attributed to inventory consumption.
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The company faces competitive intensity in the market, limiting its ability to increase prices and improve margins.
Q & A Highlights
Q: Why has the interest cost remained stable despite balance sheet improvements, and when can we expect it to decrease? A: The increase in India's interest cost is due to working capital borrowings, which are temporary. We expect the reduction in debt to reflect in lower interest costs in the coming quarters. - Gaurav Kumar, CFO
Q: Can you provide insights on the volume growth across replacement, OE, and exports in India? A: The replacement segment saw a 5% growth, OE declined by almost 10%, and exports were flat. We expect further improvement in replacement momentum. - Gaurav Kumar, CFO