APL Apollo Tubes Gain Momentum after its Subsidiary Secures Rs 500 cr incentives

While mixed investor sentiments were evident across sectors, Indian headline indices experienced a steep decline in closing trades. The top-performing sectors were BSE Realty and BSE Healthcare, while BSE Information Technology and BSE Telecommunications had the worst performances. 

Shares of APL Apollo Tubes Ltd gained in early trades, reaching an intraday high of Rs 1,333.95 per share on the BSE. The company recently announced that APL Apollo Building Products Private Limited, a wholly-owned subsidiary of the company, has been granted Rs 500 crore in incentives by the State Investment Promotion Board (SIPB), Government of Chhattisgarh, with benefits including stamp duty relaxation, 75% Net SGST exemption for 15 years, electricity duty exemption for 15 years and transportation subsidy for exports for 15 years. 

Investors were first attracted to the company as it released robust operational updates for the June quarter. For Q1FY24, the company reported the highest quarterly sales volume of 6,61,501 tons compared to 4,22,788 tons in Q1FY23 and 6,49,726 tons in Q4FY23. According to the company, the sales volume was boosted by a greater proportion of value-added products.  

Considering the company’s quarterly performance, on a consolidated basis, it reported a modest growth of 5.13% from Rs 4,214.73 crore registered in Q4FY22, recording total revenue of Rs 4,431.09 crore in Q4FY23. It has reported strong operating profit growth of 23%. When compared to the same quarter last year, the net profit for the fourth quarter of FY23 climbed 14.27%, from Rs 176.61 crore to Rs 201.82 crore. 

Over the past year, shares of the company have climbed more than 50%, reaching a 52-week high of Rs 1,398.55 per share on the BSE. With its headquarters in Delhi NCR, APL Apollo Tubes Ltd is the largest producer of structural steel tubes in India. 

Keep a close eye on this stock for the upcoming sessions!

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet, and is subject to changes. Please consult an expert before making related decisions.