Introduction
APL Apollo Tubes ltd, India’s premier producer of structural steel tubes, has made remarkable strides in the industry, showcasing impressive financial performance and ambitious expansion plans.
Recently, the company achieved its highest-ever quarterly net sales and signed Memorandums of Understanding (MoUs) with top distributors to sell 2.4 million tonnes of structural steel tubes in FY24. With a commitment to achieving 100% organic capacity expansion and becoming debt-free by the end of FY24, APL Apollo Tubes is set on a growth trajectory that sets it apart from its competitors.
Headquartered in Delhi NCR
Headquartered in the Delhi National Capital Region (NCR), APL Apollo Tubes operates as India’s leading producer of structural steel tubes. With an annual manufacturing capacity of 3.6 million tonnes, the company efficiently manages a three-tier distribution and supply network. Its extensive network comprises over 800 distributors, 2 lakh retailers, and fabricators.
APL Apollo Tubes caters to the domestic market and serves 20 other countries through its grid of warehouses and division offices in 29+ cities. The company strategically operates manufacturing facilities in 11 locations, with two facilities relying on green energy for over 85% of their power needs.
APL Apollo Tubes offers various products under various categories, including Apollo Structural, Apollo Standard, Apollo Exclusive, Apollo Galv, Apollo Tricoat, Apollo Concept, and Apollo Z.
These product categories encompass various steel tubes, such as pre-galvanized tubes, structural steel tubes, galvanized tubes, MS black pipes, and hollow sections. APL Apollo Tubes aims to replace conventional construction products with innovative steel solutions that enhance durability and deliver superior performance.
Products Overview
APL Apollo Tubes, a leading provider of steel tubes in India, offers a comprehensive range of product categories that cater to various construction and industrial applications.
Each variety is intended to meet specific needs, ensuring strength, durability, and exceptional performance. Let’s explore the key product categories offered by APL Apollo Tubes:
1. Apollo Structural: Strength, Stability, and Durability
Apollo Structural is a product category offered by APL Apollo Tubes, encompassing a wide range of structural steel tubes. These tubes are meticulously designed and manufactured to provide strength, stability, and durability to various construction projects.
They are integral to building frames, roof trusses, bridges, and other infrastructure projects. The robustness and reliability of Apollo Structural tubes make them an ideal choice for jobs that require exceptional structural integrity.
Sub-categories of Apollo Structural:
Apollo Fabritech
Apollo Fabritech is a range of steel building components, including columns, beams, and trusses. Apollo Fabritech is Made from high-quality steel. Apollo Fabritech products are designed to withstand the harsh Indian climate. They are available in various sizes to meet the requirements of different projects.
Apollo Build
Apollo Build is a range of steel building kits, including warehouses, workshops, and retail stores. These kits, made from high-quality steel, are designed for easy assembly. They are available in various sizes to meet the needs of different tasks.
Apollo DFT
Apollo DFT is a high-performance steel coating with excellent corrosion resistance and durability. Available in various colours and finishes, Apollo DFT coatings cater to the diverse needs of different projects.
Apollo Column
Apollo Column is a versatile steel column used in various applications, including scaffolding, fencing, and roofing. Made from high-quality steel, Apollo Column is available in several dimensions to meet the requirements of different projects.
2. Apollo Standard: Versatile and Reliable
The Apollo Standard product category by APL Apollo Tubes consists of standard steel tubes known for their versatility and reliability. These tubes find applications across various industries, including construction, automotive, furniture, and general engineering.
Apollo Standard tubes are recognized for their consistent quality, dimensional accuracy and adherence to industry standards. Their versatility makes them suitable for diverse applications, showcasing APL Apollo Tubes’ commitment to meeting the evolving needs of its customers.
Sub-categories of Apollo Standard:
Apollo Standard
Apollo Standard encompasses a range of steel products, including beams, columns, and pipes. Made from high-quality steel, Apollo Standard products are available in various sizes to meet the requirements of different projects.
Apollo Agri
Apollo Agri is a range of steel products designed specifically for agricultural applications, including fencing, gates, and storage bins. Apollo Agri is Made from high-quality steel. Apollo Agri products are built to withstand the harsh Indian climate. They are available in various sizes to meet the needs of different agricultural projects.
Apollo Fireready
Apollo Fireready is a range of steel products specifically designed for fire protection applications. These products, made from high-quality steel, can withstand high temperatures and prevent fire spread. Available in various sizes, Apollo Fireready products cater to the unique requirements of fire protection projects.
3. Apollo Exclusive: Premium Quality and Performance
Apollo Exclusive is a premium product category offered by APL Apollo Tubes, catering to specialized and high-end applications that demand exceptional quality and performance. Precisely crafted with precision and attention to detail, Apollo Exclusive steel tubes deliver superior strength, reliability, and longevity.
They are ideal for demanding projects that require top-tier performance and utmost precision. With Apollo Exclusive, APL Apollo Tubes showcases its assurance of meeting the highest quality standards and exceeding customer expectations.
Sub-categories of Apollo Exclusive:
Apollo Octagon
Apollo Octagon is a unique and stylish fence, adding appeal to any property. Made from high-quality steel, Apollo Octagon is available in various colours, including black, white, and green. It comes in multiple sizes to meet the requirements of different projects.
Apollo Elliptical
Apollo Elliptical is a unique steel fence that combines style and functionality. Made from high-quality steel, Apollo Elliptical is available in various colours, including black, white, and green. It comes in multiple sizes to meet the needs of different projects.
Apollo Oval
Apollo Oval features a classic and elegant fence, perfect for adding a trace of sophistication to any property. Made from high-quality steel, Apollo Oval is available in various colours, including black, white, and green. It comes in multiple dimensions to meet the prerequisites of different projects.
Apollo D Section
Apollo D Section is a versatile steel column used in various applications, including scaffolding, fencing, and roofing. Made from high-quality steel, Apollo D Section is available in multiple dimensions to meet the requirements of different projects.
Apollo Small Section
Apollo Small Section is a small-diameter steel tube suitable for various applications, including scaffolding, fencing, and roofing. Made from high-quality steel, Apollo Small Section is available in multiple sizes to meet the requirements of different projects.
Apollo Narrow
Apollo Narrow is a narrow-diameter steel tube suitable for various applications, including scaffolding, fencing, and roofing. It is made from high-quality steel.
Apollo Taper
Apollo Taper is a tapered steel tube ideal for various applications, including scaffolding, fencing, and roofing. Made from high-quality steel, Apollo Taper is available in several sizes to meet the needs of different projects.
Apollo Fence
Apollo Fence is a secure and durable fence suitable for enclosing property, providing security, and deterring trespassers. Made from high-quality steel, Apollo Fence is available in various styles, including picket, chain link, and wrought iron.
Apollo RoofTuff
Apollo RoofTuff is a high-quality steel roofing sheet suitable for commercial and residential applications. Made from high-quality steel, Apollo RoofTuff is available in multiple colours and finishes to meet the needs of different projects.
Apollo Mechanical
Apollo Mechanical comprises steel building components, including columns, beams, and trusses. Made from high-quality steel, Apollo Mechanical products are designed to withstand the harsh Indian climate. They are available in various sizes to meet the needs of diverse projects.
Apollo Reflector
Apollo Reflector is a high-visibility reflector ideal for safety applications, such as marking walkways and driveways. Made from high-quality steel, Apollo Reflector is available in various colours, including red, yellow, and white.
Apollo Chequered
Apollo Chequered features a unique and stylish checkered pattern, perfect for adding a trace of personality to any property. Made from high-quality steel, Apollo Chequered is available in various colours, including black, white, and green.
Apollo-Color
Apollo-Color is a range of pre-painted steel tubes available in various colours. Apollo-Color is Made from high-quality steel. Apollo-Colour tubes are designed to withstand the harsh Indian climate.
Apollo-Navrang
Apollo-Navrang comprises narrow-width, high-thickness colour-coated coils and sheets designed to replace wood in construction. Apollo-Navrang is Made from high-quality steel. Apollo-Navrang products are coated with a special alloy with excellent corrosion resistance and durability.
4. Apollo Galv: Excellent Corrosion Resistance
Apollo Galv represents APL Apollo Tubes’ galvanized steel tubes, which undergo a meticulous galvanization process. This process involves applying a protective layer of zinc to the tube’s surface, imparting excellent corrosion resistance.
Apollo Galv tubes find extensive use in outdoor and exposed environments where protection against rust is paramount. They are commonly employed in fencing, construction, and infrastructure projects. With Apollo Galv, APL Apollo Tubes ensures long-lasting performance and durability in challenging environments.
Sub-categories of Apollo Galv:
Apollo Bheem
Apollo Bheem consists of highly durable round galvanized (GI) steel pipes with deeper and longer threads. These ERW hollow structural Bheem steel tubes conform to ISO 1239 and are primarily used for carrying water.
Apollo Green
Apollo Green comprises high-quality steel pipes made from recycled materials. Apollo Green pipes are as strong and durable as traditional steel pipes while being more environmentally friendly.
Apollo Z+
Apollo Z+ includes non-corrosive square and rectangular galvanized (GI) steel tubes specifically designed for highly humid regions. These Z+ hollow steel sections adhere to high-quality standards and are suitable for rigorous fabrication.
5. Apollo Tricoat: Enhanced Protection and Longevity
Apollo Tricoat is a product category offered by APL Apollo Tubes, providing specialized steel tubes with a tri-coat protective layer. This layer comprises three layers of protective material, significantly enhancing the tubes’ resistance to corrosion, abrasion, and weathering.
Apollo Tricoat tubes find application in diverse sectors, including agriculture, irrigation, solar structures, and outdoor signage. These tubes provide long-lasting performance, ensuring enhanced protection and longevity in demanding environments.
Sub-categories of Apollo Tricoat:
Apollo Elegant
Apollo Elegant comprises steel building components designed to provide a touch of elegance and sophistication to any structure. Apollo Elegant products are made from high-quality steel in various colours and finishes. They come in multiple sizes to meet the needs of different projects.
Apollo Signature
Apollo Signature consists of steel building components designed to provide a touch of luxury and exclusivity to any structure. Made from the highest quality steel, Apollo Signature products are available in various colours and finishes. They come in multiple sizes to meet the requirements of different projects.
Apollo Plank
Apollo Plank is a versatile and durable plank suitable for various applications, including flooring, roofing, and fencing. Made from high-quality steel, Apollo Plank delivers exceptional performance.
Apollo Chaukhat
Apollo Chaukhat features a traditional Indian scaffolding structure, offering versatility and durability for various purposes, including construction, agriculture, and storage. Made from high-quality steel, Apollo Chaukhat is designed to withstand the harsh Indian climate. It is also easy to assemble and disassemble, making it a convenient and cost-effective option for different projects.
Apollo Handrail
Apollo Handrail is a sturdy and reliable handrail that provides safety and support on stairs, walkways, and other elevated surfaces. Made from high-quality steel, Apollo Handrail has various finishes, including black, silver, and white. It comes in multiple sizes to meet the needs of different projects.
Apollo Alpha
Apollo Alpha is a high-quality steel handrail designed to provide safety and support on stairs, walkways, and other elevated surfaces. Made from 100% galvanized steel, Apollo Alpha is available in various finishes, including black, silver, and white. It comes in multiple sizes to meet the requirements of different projects.
Apollo Scaff
Apollo Scaff comprises steel scaffolding products designed to deliver a safe and secure working platform for construction and maintenance projects. Made from high-quality steel, Apollo Scaff is available in various sizes to meet the needs of different projects.
Apollo Tricoat
Apollo Tricoat is a high-performance steel coating with excellent corrosion resistance and durability. Available in various colours and finishes, Apollo Tricoat coatings cater to the diverse needs of different projects.
Apollo Hybrid
Apollo Hybrid combines steel and concrete to provide the best of both materials. Apollo Hybrid structures are strong, durable, and fire-resistant. They are available in various sizes to meet the needs of different projects.
Apollo Wondoor
Apollo Wondoor comprises steel doors and windows designed to provide security and durability. Apollo Wondoor is Made from high-quality steel. Apollo Wondoor products are available in various styles and finishes to meet the requirements of different projects.
6. Apollo Concept: Tailored and Innovative Solutions
Apollo Concept is an innovative product category offered by APL Apollo Tubes, catering to specific customer requirements and industry demands. These solutions may include customized shapes, sizes, or specialized coatings to meet unique project specifications.
The Apollo Concept category showcases APL Apollo Tubes’ commitment to innovation, enabling the company to deliver tailored and advanced steel tube solutions. Whether designing tubes for complex architectural structures or addressing specific industrial needs, Apollo Concept reflects APL Apollo Tubes’ ability to adapt and provide cutting-edge solutions.
Sub-categories of Apollo Concept:
Apollo Ready Chaukhat
Apollo Ready Chaukhat features a pre-fabricated scaffolding structure that is easy to assemble and disassemble. Made from high-quality steel, Apollo Ready Chaukhat is designed to withstand the harsh Indian climate. It is ideal for various applications, including construction, agriculture, and storage.
Apollo Fencing Solutions
Apollo Fencing Solutions offers many steel fencing products, including picket, chain link, and wrought iron fences. Made from high-quality steel, Apollo fencing products are durable and secure. They are available in various styles and colours to meet the needs of different customers.
Apollo Wondoor
Apollo Wondoor comprises steel doors and windows designed to provide durability and security. Made from high-quality steel, Apollo doors and windows are available in various styles and finishes. They come in multiple sizes to meet the needs of different clients.
Steel Building Solutions (SBS)
Steel Building Solutions (SBS) is a division of Apollo that offers a wide range of steel building products, including warehouses, workshops, and retail stores. Steel Building Solutions (SBS) is Made from high-quality steel. SBS buildings are designed to be easy to assemble. They come in various sizes to meet the needs of different customers.
7. Apollo Z: Uniform Coating and Enhanced Protection
Apollo Z represents a range of pre-galvanized steel tubes offered by APL Apollo Tubes. These tubes undergo galvanization before manufacturing, ensuring a uniform coating and enhanced corrosion resistance.
Apollo Z tubes are commonly used in applications requiring exceptional strength and rust protection. They find extensive use in constructing steel structures, automotive components, general engineering projects, and other demanding applications.
APL Apollo Tubes’ product categories, including Apollo Structural, Apollo Standard, Apollo Exclusive, Apollo Galv, Apollo Tricoat, Apollo Concept, and Apollo Z, embody the company’s commitment to providing high-quality and diverse steel tube solutions.
Each category addresses specific needs and applications, ensuring customers receive reliable, durable, and performance-driven products. Whether delivering strength and stability through Apollo Structural or offering tailored solutions through Apollo Concept, APL Apollo Tubes continues to set industry benchmarks for excellence in the steel tube market.
Sector Overview
Steel and iron production is pivotal in economic progress and industrial development, serving as the backbone of any economy. With abundant iron ore and other metals reserves, India is a prominent destination for the metals and mining industry.
The country’s strategic location enables export potential and rapid growth in Asian markets, providing competitive advantages to sectors like building and infrastructure, automotive, and electricity by supplying essential raw materials at affordable prices.
India is the world’s second-largest producer of crude steel and the fourth-largest producer of iron. The iron and steel industry significantly impacts GDP growth and foreign exchange earnings, making it a government-supported industry that underpins India’s infrastructure and development sectors.
In response to high inflation, the government imposed export taxes on metals and steel products in May 2022, resulting in a subsequent drop in metal prices. Factors like conflicts causing supply chain disruptions and the reopening of China’s economy have influenced metal prices.
Over the past decade, the steel industry in India has witnessed remarkable growth, with steel demand increasing by approximately 80% since 2008 and production rising by an impressive 75%.
The sector holds enormous potential for expansion, targeting a production capacity of 300 million tonnes by 2030. It is expected to propagate at a Compound Annual Growth Rate of 3.47% from USD 1,353 billion in 2022 to USD 1,718 billion by 2030.
Financial Overview APL Apollo Tubes ltd
APL Apollo Tubes reported a modest quarterly revenue growth of 5.13%, reaching ₹4,431.09 crore in Q4FY23 compared to ₹4,214.73 crore in Q4FY22. The company demonstrated a strong year-on-year EBITDA growth of 21.34%. Net profit for Q4FY23 surged by 14.27% to ₹201.82 crore from ₹176.61 crore in the same quarter of the previous year.
On an annual basis, the company achieved net profit growth of 3.7% to ₹641.86 crore compared to ₹618.98 crore during the last year. Net sales increased by 23.75% to ₹16,165.95 crore from ₹13,063.32 crore in the previous fiscal year (ended March 2022).
While APL Apollo Tubes exhibits a higher Price-to-Earnings (PE) ratio than its competitors and the industry average, the company compensates with strong profitability indicators. Its returns on equity (ROE) and returns on capital employed (ROCE) stand at 31% and 34%, respectively, showcasing robust profitability.
APL Apollo Tubes’ record-breaking net sales and the signing of MoUs to sell 2.4 million tonnes of structural steel tubes in FY24 further enhance its growth prospects. Notably, these MoUs exclude sales from the exports division, the Original Equipment Manufacturer (OEM) division, and the sale of coated products from the recently inaugurated Raipur facility.
Deepak Goyal, Director (Operations) and Chief Financial Officer of APL Apollo Tubes emphasized the company’s significant milestones, including its organic capacity expansion plans and debt reduction goals.
With a market valuation of ₹37,150 crore, the company’s promoters hold a 31.15% stake, while institutional investors hold 36.80%, of which foreign portfolio investors (FPIs) own a significant 25.68%.
The stock has witnessed substantial buying interest, surging over 16% in the past month and reaching a 52-week high of ₹1,398.55 per share on the BSE. Over the past year, APL Apollo Tubes has delivered impressive returns of over 55%.
Specialty Steel Sector Outlook
The Union Budget 2023-24’s emphasis on infrastructure and development bodes well for the metals and mining sector in the long run.
The Ministry of Steel received a substantial allocation of ₹70.15 crore in the budget, and the specialty steel sector was introduced to a production-linked incentive scheme under the Atmanirbhar Bharat 3.0 package.
The Indian government’s “Make in India” initiative aims to increase the manufacturing sector’s contribution to GDP.
The government has identified numerous industries that extensively use metals, promoting research and collaboration to enhance the sector. India possesses cost advantages in steel production and conversion costs.
With reforms like the Make in India campaign, infrastructure development, rural electrification, and smart cities, the metal sector, particularly the steel industry, is expected to transform significantly in the coming years.
Regarding APL Apollo Tubes, it is important to note the higher PE ratio compared to industry peers, which raises valuation concerns.
The decline in promoter holding over the years is also worth considering. However, the company’s MoUs with top distributors, its track record of financial success, growth potential, and the positive outlook for the steel tube industry in India make it an enticing prospect for investors.
Conclusion
In conclusion, APL Apollo Tubes stands out as India’s largest producer of structural steel tubes, backed by impressive financial performance and ambitious expansion plans.
The company’s commitment to organic capacity expansion and its goal of becoming debt-free by the end of FY24 demonstrate its determination to achieve sustainable growth.
While valuation concerns exist, the company’s strong profitability indicators and positive market sentiment make it an attractive investment opportunity.
FAQs (Frequently Asked Questions)
What is APL Apollo Tubes?
APL Apollo Tubes is India’s largest producer of structural steel tubes, offering a diverse range of steel tube solutions for various applications.
Where is APL Apollo Tubes headquartered?
APL Apollo Tubes is headquartered in Delhi NCR, India.
What are the different product categories offered by APL Apollo Tubes?
APL Apollo Tubes offers several product categories, including Apollo Structural, Apollo Standard, Apollo Exclusive, Apollo Galv, Apollo Tricoat, Apollo Concept, and Apollo Z.
What are some key products under the Apollo Structural category?
Some key products under the Apollo Structural category include Apollo Fabritech, Apollo Build, Apollo DFT, and Apollo Column.
What are some key products under the Apollo Exclusive category?
Some key products under the Apollo Exclusive category include Apollo Octagon, Apollo Elliptical, Apollo Oval, Apollo D Section, Apollo Small Section, Apollo Narrow, Apollo Taper, and Apollo Fence.
What are some key products under the Apollo Tricoat category?
Some key products under the Apollo Tricoat category include Apollo Elegant, Apollo Signature, Apollo Plank, Apollo Chaukhat, Apollo Handrail, Apollo Alpha, Apollo Scaff, Apollo Tricoat, Apollo Hybrid, and Apollo Wondoor.
What is the outlook for the steel industry in India?
India’s steel industry holds enormous growth potential, driven by infrastructure development, government initiatives like Make in India, and increasing steel demand. The sector is expected to transform and expand in the coming years significantly.
Is APL Apollo Tubes solely focused on the Indian market?
While APL Apollo Tubes is headquartered in India and serves the domestic market, it also exports its products to 20 other countries, expanding its reach beyond India.
What sets APL Apollo Tubes apart from its competitors?
APL Apollo Tubes distinguishes itself through its extensive distribution and supply network, robust manufacturing facilities, and diverse range of innovative steel solutions. Its commitment to organic capacity expansion and debt reduction further enhance its competitive edge.
What factors have influenced the steel industry’s growth in India?
Factors such as abundant reserves of iron ore, strategic location, government support, and increasing demand from sectors like building, infrastructure, automotive, and electricity have contributed to the growth of the steel industry in India.
How does the “Make in India” initiative impact APL Apollo Tubes’ prospects?
The “Make in India” initiative promotes domestic manufacturing and aims to increase the sector’s contribution to GDP. APL Apollo Tubes aligns with this vision by producing innovative steel solutions locally, fostering economic growth and development.
How does Apollo Tricoat enhance the longevity of steel tubes?
Apollo Tricoat tubes feature a tri-coat protective layer consisting of three layers of material, providing enhanced resistance to corrosion, abrasion, and weathering, thus increasing their longevity.
Imp. Disclaimer: This article analyzes APL Apollo Tubes for informational purposes only. It is not intended as investment advice. Readers should research and consult with financial professionals before making investment decisions.
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