PL First Cut – Apar Industries Q2FY24

PL First Cut – Apar Industries Q2FY24 – Amit Anwani – Research Analyst - Prabhudas Lilladher Pvt Ltd

Apar Industries Q2FY24 Results-First Cut; Strong quarterly performance, Revenue above estimates, EBITDA margin marginally below our estimates

Result summary

✳️Consolidated sales grew 21.4% YoY to Rs39.3bn (PLe ~Rs38.3bn and consensus estimate of Rs35.2bn), comprising of Conductors/ Speciality Oil/ Cables ~49%/~31%/~22% of total sales.

✳️Conductors segment reported a growth of 35.1% YoY to Rs19.4bn. Cables reported a 15.8% YoY growth to Rs8.8bn. Speciality oil segment revenue grew 1.9% YoY to ~Rs12bn.

✳️EBITDA grew 54.8% YoY to Rs3.5bn (PLe Rs3.6bn and consensus estimate of Rs2.7bn), with EBITDA margins expanding by 193bps YoY to 8.9% (PLe ~9.3%), owing to lower other expenses as % of sales (13.4% vs 15.7% in Q2FY23).

✳️PAT grew ~69% YoY to ~Rs1.7bn (PLe ~Rs1.9bn and consensus estimate Rs1.4bn), led by strong operational performance and higher other income (up 53.5% YoY to Rs188mn), despite higher interest expenses (up 44.9% to Rs1bn).

✳️At the CMP, the stock is currently trading at 32.6x/26.2x FY24/25E. We have Accumulate rating on stock with TP of Rs5,499