Buy Apollo Tyres, target price Rs 290: Emkay Global

Emkay Global has buy call on Apollo Tyres with a target price of Rs 290. The current market price of Apollo Tyres Ltd. is Rs 225.65.

Time period given by analyst is one year when Apollo Tyres Ltd. price can reach defined target.

Apollo Tyres Ltd., incorporated in the year 1972, is a Mid Cap company (having a market cap of Rs 14302.47 Crore) operating in Tyres sector.


Apollo Tyres Ltd. key Products/Revenue Segments include Tyres, Tubes & Flaps, Other Operating Revenue, Others and Scrap for the year ending 31-Mar-2021.


Financials
For the quarter ended 30-09-2021, the company reported a Consolidated Total Income of Rs 5106.21 Crore, up 10.41 % from last quarter Total Income of Rs 4624.92 Crore and up 18.17 % from last year same quarter Total Income of Rs 4321.11 Crore. Company reported net profit after tax of Rs 173.72 Crore in latest quarter.

Investment Rationale
The brokerages positive stance is based on the prospects of a strong volume recovery in the domestic and Europe markets. It maintains Buy with a revised TP of Rs290 (Rs305 earlier), applying 14x Dec’23E EPS (15x Sep’23E earlier). Key downside risks are lower than-expected demand in key geographies, higher competitive intensity, further increase in commodity prices and adverse currency movements.


Promoter/FII Holdings
Promoters held 37.34 per cent stake in the company as of 30-Sep-2021, while FIIs owned 24.07 per cent, DIIs 14.44 per cent.