Financial Performance

  • Q2 FY27 Consolidated Performance: Revenue grew 31% YoY to ₹309.6 crore with sales volume of 24,501 tons (up 13% YoY)
  • EBITDA: Recovered to ₹11.5 crore from ₹3 crore in Q1 FY27, with margin of 3.7%
  • Standalone Performance (excluding Kisan): EBITDA margin at 5.7%
  • Kisan Subsidiary: Reported EBITDA loss of ₹3,700 per ton (improved from ₹9,000 per ton loss in Q1)

Operational Highlights

  • Product Mix: UPVC constitutes 45% of sales, CPVC 15-20%, PPR less than 5%, with balance from water tanks, window profiles, OPVC pipes, and HDPE pipes
  • Capacity Expansion: Current capacity 240,000 tons, planned expansion to 288,000 tons over next 2 years
  • Plant Rationalization: Shutting down smaller units in Ahmedabad and Raipur to improve efficiency
  • Varanasi Plant: Newly commissioned and ramping up operations
  • Window Profile Business: Currently scaling up with ₹70-80 crore annualized run rate

Strategic Initiatives

  • Ceramic Tiles Entry: Acquired 76% stake in Mazzini Tiles through Apollo Ceramics subsidiary
  • Investment Plan: ₹400-500 crore planned investment to acquire 4-5 operational tile manufacturing assets in Morbi
  • Revenue Target: ₹1,000 crore revenue and ₹225 crore EBITDA from ceramics business
  • Valuation Multiple: Targeting 4-7x EV/EBITDA for acquisitions
  • Business Model: Focus on contract manufacturing for organized brands initially, with possible own brand launch later

Guidance and Outlook

  • H2 FY27 Expectations: Management expects second half to be better than first half due to monsoon ending and PVC price stabilization
  • Apollo Standalone Target: ₹8,000-10,000 per ton EBITDA in H2 FY27 (from ₹7,000/ton in Q2)
  • Kisan Turnaround: Target to reach breakeven within 6-9 months, then ₹4,000-5,000/ton positive EBITDA in FY28
  • Volume Guidance: Q3 FY27 expected flattish at 25,000 tons, Q4 FY27 target of 30,000 tons, full-year target of 105,000 tons
  • Long-term Vision: ₹3,000 crore revenue from plumbing business and ₹1,000 crore from ceramics by 2030

Capacity and Expansion Plans

  • South India Expansion: Planning new greenfield plant with 50,000 tons capacity, land acquisition in process
  • Funding: Expansion to be funded through internal cash flows without leveraging balance sheet
  • Asset Monetization: Identified 2-3 land parcels for potential sale raising approximately ₹130 crore to fund South India capex

Market Position and Strategy

  • Market Share: Currently ~4% pan-India market share in PVC pipes
  • Geographic Presence: 70% of sales from North India, expanding in Central/East India through Varanasi plant
  • Competitive Advantage: Leveraging APL Apollo building materials brand strength
  • CPVC Performance: Double-digit growth in H1 FY27