APL Apollo Tubes Q2 FY27 Earnings Call Transcript Released

APL Apollo Tubes Limited has released the transcript of its Q2 FY'27 earnings conference call, which was held on October 26, 2026. The call featured management including Chairman and Managing Director Mr. Sanjay Gupta, Director Mr. Rahul Gupta, Director (Operations) Mr. Deepak Goyal, Chief Strategy Officer Mr. Anubhav Gupta, and Chief Financial Officer Mr. Chetan Khandelwal.

During the call, management highlighted that the company achieved its best quarter in terms of sales volume, EBITDA, and net profit. The sales volume reached 960,000 tons, despite disruptions in UAE operations, high raw material price swings, domestic steel shortages, and container trade issues for exports. The company attributed this performance to its core strengths: the APL Apollo brand, leading to better pricing and EBITDA spreads, and an increasing focus on value-added products beyond construction and renewable sectors. New products for Defence and Aerospace sectors are being developed.

Management expressed confidence in maintaining double-digit volume growth in the second half of the fiscal year. They are on track to achieve a 20% growth in absolute EBITDA by March 2027, with EBITDA per ton at ₹6,000 being sustainable due to the contribution from high-value APL Apollo and roofing products. The company's working capital days remained at zero, and cash on books increased by 15% to ₹16 billion as of September 2026. CAPEX is on track to achieve 7 million tons of greenfield plus brownfield capacity, plus 1 million ton of de-bottlenecking capacity within the next two years.

Discussions also covered volume guidance for FY2027, with a confirmed 15% growth for profitable segments like the APL Apollo brand and roofing products, despite uncertainties in Dubai operations and low-margin business products. Management addressed inventory levels, financial assets, interest costs, and other income. The roofing sheet segment's sales growth drivers, competitors, and future scaling were detailed, along with efforts to reduce power and freight costs. The company expects its net cash balance to increase to ₹23 billion by year-end, with ₹200-300 crores allocated for CAPEX.

Further insights were provided on the sustainability of EBITDA per ton, with management explaining that the increase is due to ceasing non-profitable business, expansion in roofing products, and ongoing innovations. The company anticipates Q3 to be even better than Q2. Regarding the UAE operations, management acknowledged the ongoing disruptions but stated that the capacity is ready and will contribute significantly once operations normalize, with potential for ₹8,000 to ₹10,000 per ton EBITDA from new mills by March 2027. The company aims to achieve ₹2,200-2,300 crores EBITDA for the current year, with projections to cross ₹2,500 crores next year. The potential for ₹3,000 crores EBITDA in FY2028 was discussed, contingent on the recovery of Dubai operations and stabilization of steel availability and freight costs.