Apollo Tyres Limited

INR 69.3 billion

details of the operations for the last quarter. The consolidated revenue for the quarter stood at INR 69.3 billion, a growth of 5% over the same quarter last year, but 8% sequentially, which indicates a certain p

5%

the last quarter. The consolidated revenue for the quarter stood at INR 69.3 billion, a growth of 5% over the same quarter last year, but 8% sequentially, which indicates a certain pickup in momentum

8%

nue for the quarter stood at INR 69.3 billion, a growth of 5% over the same quarter last year, but 8% sequentially, which indicates a certain pickup in momentum. The consolidated EBITDA for the quart

INR 9.5 billion

y, which indicates a certain pickup in momentum. The consolidated EBITDA for the quarter stood at INR 9.5 billion, a margin of Gaurav Kumar: to 13.6% 13.7% compared last quarter. We've

13.6%

ITDA for the quarter stood at INR 9.5 billion, a margin of Gaurav Kumar: to 13.6% 13.7% compared last quarter. We've maintained the margins inspite of the cost pressures, though

13.7%

the quarter stood at INR 9.5 billion, a margin of Gaurav Kumar: to 13.6% 13.7% compared last quarter. We've maintained the margins inspite of the cost pressures, though nowher

INR 4.5 billion

w material cost pressure. the in for to EBITDA Coming to the balance sheet, we saw about INR 4.5 billion reduction in net debt as of December 2024, compared to end of previous quarter. The net debt the

0.7x

cember 2024, compared to end of previous quarter. The net debt the consolidated operations is at 0.7x at the end of this quarter, pretty much flattish compared to where we started the year. In India,

INR 45.4 billion

, the other areas sort of pulled it down to this marginal growth. The revenue for the quarter was INR 45.4 billion, a growth of 5% over the same quarter last year, and EBITDA for the quarter stood at INR 5 billion

INR 5 billion

45.4 billion, a growth of 5% over the same quarter last year, and EBITDA for the quarter stood at INR 5 billion, a margin of 11.1% compared to 12.1% in the last quarter. In terms of the demand outlook, we expe

11.1%

% over the same quarter last year, and EBITDA for the quarter stood at INR 5 billion, a margin of 11.1% compared to 12.1% in the last quarter. In terms of the demand outlook, we expect the replacement

12.1%

arter last year, and EBITDA for the quarter stood at INR 5 billion, a margin of 11.1% compared to 12.1% in the last quarter. In terms of the demand outlook, we expect the replacement demand momentum to

“In terms of the demand outlook, we expect the replacement demand momentum to continue to be healthy in Q4.”

“Moving to the RM outlook, we expect the RM cost to be range bound in Q4, almost around similar levels as Q3, which indicates a certain plateauing out.”

“In terms of outlook, we expect the demand to continue to recover going forward.”

“Q4 to Q3, it is, we expect it to be flattish, and to that extent, some rollover impact of price increases should play a little bit into the gross margins.”

“So, on replacement, we do expect further improvement in the momentum like you initially commented in your opening remarks.”

“We expect this growth to further improve as we go forward.”

“So, clearly, Siddhartha, we are looking at the US as our next growth market, and you'll see, we will be growing slow and steady.”

“And next year, should we again continue to expect similar, INR 1,000 crores of Capex, or how should we look at the coming years?”

“Next year, the Capex number will increase.”

“The exact numbers will get frozen in terms of cash outflow in the next month or so, but the Capex number for the next year would have a certain amount of growth Capex over and above the maintenance Capex.”

Gaurav Kumar

48

Mihir Vora

12

Basudeb Banerjee

11

Siddhartha Bera

10

Amyn Pirani

6

Neeraj Kanwar

4

Amar Kant Gaur

4

Jinesh Gandhi

3

Mukesh Saraf

3

Rohit Jain

3

Gaurav Kumar

to 13.6% 13.7% compared last quarter. We've maintained the margins inspite of the cost pressures, though nowhere near the levels of previous year given the steep raw material cost pressure. the in for to EBITDA Coming to the balance sheet, we saw about INR 4.5 billion reduction in net debt as of December 2024, compared to end of previous quarter. The net debt the consolidated operations is at 0.7x at the end of this quarter, pretty much flattish compared to where we started the year. In India, we witnessed that the overall volume growth was marginal, where the good growth in the replacement volumes was negated by the decline in the OE volumes. We registered strong growth in both TBR and PCR replacement segment, the two core segments. However, the other areas sort of pulled it down to this marginal growth. The revenue for the quarter was INR 45.4 billion, a growth of 5% over the same quarter last year, and EBITDA for the quarter stood at INR 5 billion, a margin of 11.1% compared to 12.1

Mihir Vora

Thanks, Gaurav. We will now open the floor for Q&A session. Anyone who wishes to ask a question can please use the raise hand option. Once you are done asking your question, please lower your hand. We'll wait for a couple of seconds for the question queue to assemble. First question is from the line of Amyn Pirani. Amyn, I've unmuted. You can go ahead.

Gaurav Kumar

Yes, hi. Thanks for the opportunity. Actually, my first question was on the interest costs. We have seen balance sheet deleveraging for a while now, and especially in this quarter, but on a consolidated basis, interest cost is still remaining in that stable range. In fact, in the standalone, the interest costs have actually moved up quarter-on-quarter. So, is there anything that we should be mindful of? And when do we see the interest cost number actually trending down? So, Amyn, you're right. The India interest cost has gone up mainly on account of working capital borrowings, which is largely a combination of the profitability challenges and a slightly weaker market, and the Europe interest cost has come down. Moving up on the working capital borrowings, etc., is fairly a temporary measure.

Amyn Pirani

Okay. Okay. So, this reduction in debt should start reflecting in the interest cost number in the coming quarters.

Amyn Pirani

Okay. Okay. And secondly, you also mentioned that RM should be range-bound in 3Q versus 2Q. So, how should we interpret it? Because I'm guessing that some price hikes have happened and maybe more are planned or not, I would love to hear from you. So, if RM is flattish, then should gross margin actually improve quarter-on-quarter because of the impact of price hikes, or how should we think about that?

Gaurav Kumar

Q4 to Q3, it is, we expect it to be flattish, and to that extent, some rollover impact of price increases should play a little bit into the gross margins.