As of 2024, the company generates 87% of its revenues from India, 11% from Europe and 2% from other countries. The company is closing its Netherlands plant by June 2026 and transitioning production to Hungary and India, a restructuring expected to lift European profitability in the second half of FY '27. Apollo Tyres approved capacity expansion at its Andhra Pradesh plant, adding 3.7 million PCR tyres and 1.3 million TBR tyres annually by end of FY2029, with capex of approximately Rs 5,810 crore funded through internal accruals and debt.
Cyborg Score Rationale
Apollo Tyres achieved record quarterly revenue with consolidated EBITDA margin improving to 15.3% from 13.7% year-on-year. Net debt halved to INR 13 billion, dropping net debt-to-EBITDA to 0.4x from 0.8x the previous quarter. However, European markets remain weak with structural headwinds requiring restructuring investment.
Top Insights
India operations saw 13% revenue increase and significant EBITDA margin jump to 14.5%, driven by robust demand with mid-teen volume growth across OEM, replacement, and export segments.
BCCI cricket team jersey sponsorship significantly boosted Apollo's brand visibility, especially in rural and consumer tyre segments, with management seeing positive impact on brand recall and business outcomes.
Net debt halved to INR 13 billion, with net debt-to-EBITDA improving dramatically to 0.4x, demonstrating strong balance sheet strengthening.
In Europe, demand stayed weak with flattish revenue and negative market growth environment, though the situation showed slight improvement.