Apollo Pipes Limited held its Q1 FY27 earnings conference call on July 31, 2026, with management including Managing Director Sameer Gupta, Joint Managing Director Arun Agarwal, CFO A.K. Jain, and Group Chief Strategy Officer Anubhav Gupta. The call was moderated by Aasim Bharde from DAM Capital Advisors Limited.

Q1 FY27 Performance Overview

  • Q1 FY27 total sales volume was flat Year-over-Year (YoY)
  • Consolidated normalized business EBITDA margins were 7%
  • Performance was impacted by extreme PVC resin price volatility, with prices falling by ₹32 per kg in April, little movement in May, and another ₹5 per kg fall in June
  • Inventory write-downs and aggressive pricing affected profitability
  • Fixed expenses for new business verticals (Varanasi plant and window profile business) contributed to margin pressure

Segment Performance

  • Apollo standalone business achieved 8% EBITDA margin
  • Kisan standalone business achieved 6% EBITDA margin
  • CPVC segment showed YoY growth despite flattish overall company performance
  • Government infrastructure business (O-PVC/HDPE) was a major drag with almost zero contribution
  • Fittings showed single-digit growth
  • Water tanks showed double-digit growth
  • Bath fittings remained flattish

New Business Initiatives

  • Varanasi plant commissioning is ongoing with target to utilize 30% capacity in FY27
  • Window profile business expected to contribute 7-8% to revenue in FY27, with potential to reach 10% at current capacity and 15% with expansion
  • Additional 0.5% margin impact at Apollo standalone level due to new business costs

Market Conditions & Pricing

  • Minimum Import Price (MIP) of $766 per MT (approximately ₹82 per kg) imposed 12 days prior to call
  • Current market prices near Reliance price levels, 1-2% above MIP
  • Extensive rains at ports causing temporary supply disruptions
  • Distributors maintaining low inventories due to price volatility
  • Construction segment represents 60% of sales

Financial Guidance & Targets

  • High double-digit volume growth targeted for FY27 and coming years
  • Q2 expected to show double-digit YoY growth
  • Second half expected to be stronger than first half post-monsoon
  • EBITDA margin target of 7-8% for next 12-15 months
  • Long-term target of ₹5,000 crore revenue by FY31 with 10-12% EBITDA margins
  • Four large plants targeted across India, each contributing ₹800-1,000 crore revenue

Capital Expenditure & Funding

  • FY27 and FY28 CAPEX of approximately ₹200 crores total (₹100 crores each year)
  • Funding from internal cash flows and working capital release
  • Working capital initiatives targeting reduction from current 80 days inventory
  • Debtor days stable at 30 days, targeting 25 days by FY27-end or H1 FY28
  • Net working capital day target of 30 (currently 45)

Kisan Merger & Synergies

  • Scheme of amalgamation already filed
  • Expected 1% cost synergies at overall company level post-merger
  • Kisan plant capacity of 8,000-8,500 tons per quarter
  • Current run rate of ~5,500 tons per quarter (flattish for last four quarters)

Geographic Expansion Strategy

  • Secunderabad plant serving North India
  • Kisan plant (Tarapur) serving Maharashtra, Gujarat, Madhya Pradesh
  • Varanasi plant serving Uttar Pradesh, Bihar, Odisha belt
  • South India plant planning stage - land identification underway
  • Target to complete land acquisition in FY27, plant construction from Q2 FY28

Raw Material Outlook

  • PVC resin availability expected to normalize post-rain disruptions
  • No significant supply disruption expected in near future
  • Price stability expected due to MIP protection at ₹82/kg floor

Working Capital Management

  • Current inventory at 80 days
  • Focus on improving inventory churn through sales momentum
  • Supplier credit terms expected to improve with scale
  • Cash-and-carry schemes expanding to South and West India