1. Revenue in Q1 FY23 grew by 59% to 218.9 crs from 137.6 crs in Q1 Fy22 but down 11.5% sequentially from 247.5 crs. Volume grew 38% to 14406MT from 10200MT in Q1 FY22.
2. EBITDA was 20.0 crs as against 17.4 crs y-o-y but dropped from 28.4 cr in previous quarter. Margin also dropped to 9.2% from 11.5% q-o-q. EBITDA per tonne dropped to 14000 per tonne from 17500 per tonne. This drop was because of drop in pvc prices.
Company is targeting 20000 EBITDA per tonne in next two years. 3. Growth looks robust y-o-y basis because of low base last year but weak sequentially because
of massive correction in PVC prices. This created uncertainty among channel partners who went into destocking mode.
PVC prices have dropped 18% in 1 st quarter and 17% in July month so far. The price has reached near pre covid level. This should increase confidence in channel partners.
4. When prices goes down, price gap between low quality and high quality narrows down. So
Large players also becomes competitive on pricing with unorganised sector. Here larger
players get opportunity to grab share of unorganised sector.
5. Building goods contributed 55% in topline of which 35% is Value added products and 20% is
other building products. Target revenue share for value added product is 50% in next 2-3
Years. CPVC HDPE and value added products were major driver for growth this quarter.
6. Introduced PPR segment with complete range of pipes and fittings products in major
demand from north India and are receiving good response from distributors. Very few
players dominate this space, with market of about 14 billion INR.
Company is targeting 100cr in 2-3 years from this product. 7. PPR is comparatively expensive than other polymers. The product is even higher in quality
than CPVC. In some cold regions, even CPVC fails. where only PPR which is used. Even in
Europe PPR is widely used and accepted.
8. Company did capex of 36cr in Q1 FY23 from internal cash flows. Planning capex of 150 crs in
3 years in North India towards capacity expansion, where company already has deeper
penetration. The expansion will be majorly on Value added products.
9. Launched TV commercial during the quarter which has garnered good response. This will
help company strengthen its brand position in the market.
10. Company is focusing on
a) To optimize capacity utilisation which will help increase sales in coming quarter
b) To enhance presence in new potential geographies of untapped eastern market
c) increase revenue share on Value added segment.
Company is targeting revenue at 30% CAGR for next three years and targeting 2000 crore revenue.
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1. Revenue for the quarter was ₹1539 Cr (20% growth YoY). The EBITDA margin was 29.5% for the quarter despite inflationary pressures.
2. They saw significant growth in their CDMO business
(196% growth YoY, 60% growth QoQ) which helped offset the muted performance of the ARV business.
3. RM prices remain elevated due to the geopolitical situation and the Covid lockdown in China. But they are expecting gradual decrease in RM prices during the year
4. They are confident of achieving the aspirational target of $1 billion in revenue which will be supported by several approvals during the year.
5. With respect to their ARV business in LMIC markets - the demand was soft but the major issue is that the pricing has been largely
1. Company overview 2. Management 3. APL Apollo Tubes Ltd 4. Products 5. Margins 6. Plants 7. Distribution 8. Marketing 9. Revenue mix 10. Company’s Key Focus Areas 11. Future Capex
12. Financials 13. EBITDA Margins
1. Company Overview
Apollo Pipes is among the top 10 leading piping solution providing companies in India. Headquartered at Delhi, the Company enjoys strong brand equity in the domestic markets. With more than three decades of experience
in the Indian PVC Pipe Market, Apollo Pipes holds a strong reputation for high quality products and an extensive distribution network.
1. They had a great performance in FY22. They had initially given a guidance of 10-15% growth in revenues and ended the year with 47% growth in topline.
The EBITDA margin was above 50% for the year despite inflationary pressure.
2. A major part of the growth came from the Specialty Chemicals segment. Revenue for this vertical grew by 51% YoY due to increased volumes. They saw good volume offtake for the 1st commercialized
molecule which is now generic. But the partner developed a robust life cycle management which generated good volumes.
3. There was also a commercialization of a 3rd molecule in this segment which helped increase volumes. They currently have 1 more molecule in development
1. Total revenue registered a y-o-y growth of 23% to Rs. 1,190 Cr from Rs. 965 Cr, but down
25% q-o-q from 1595 cr.
2. Degrowth in EBITDA was 40% to 126cr in Q1 23 from 210 cr in Q1 22. Margins also dropped
to 11% from 22%. Reasons for fall in EBITDA were because of Weak agri demand and
inventory losses due to fall in PVC prices.
3. PVC Pipes & Fittings volume grew 29% y-o-y to 71,960 MT and for PVC Resin volume registered a y-o-y growth of 25% to 62,746 MT. Volume for CPVC was 3600 MT with revenue of about 150 crores.
1. Q1 23 Revenues 88.4 Cr vs Q1 22 106.8 Cr - Decline of 17%
2. EBITDA 15.2 Cr Q1 23 vs 26.3 Cr - Decline of 42%
3. EBITDA margins 17% for Q1 23 vs 25%
Forex loss of 4.9 Cr.
Actual EBITDA = 20.17 Cr. EBITDA margins 23%
4. Geopolitical issues, covid lockdowns in china and semiconductor shortages affected the company’s performance as SDAs demand gone down.
Expecting Good revival from Q3 FY 23 for SDA
5. SDA have highest margins compared the other products manufactured by Tatva Chintan
#Syngene announced a 10 year agreement with Zoetis to manufacture the biological entity for Librela(bedinvetmab). It is the first monoclonal antibody for the treatment of osteoarthritis in dogs
1. About the drug
Currently, the product is only approved for sale in Europe but management has indicated that US approval is expected by the end of 2022. Zoetis launched the product in the second quarter of 2021 in Europe.
Sales for the product were $15 million in both Q3 and Q4 of 2021 and $20 million in Q1 of 2022. Zoetis management has said that the product will be a blockbuster by the end of 2022 bringing in $100 million from the EU alone. (Blockbuster product in animal health is products with