Shares of Apollo Tyres jumped over 6 percent to hit its 52-week high on Tuesday as its strong September quarter results beat Street expectations. Its consolidated net profit increased by 11 percent to ₹194 crore in the second quarter ended September, riding on the back of robust sales in domestic as well as international markets.
The tyre major had reported a net profit of ₹174 crore in the July-September period of the last fiscal.
The stock rose as much as 6.2 percent to its 52-week high of ₹303.40 in intra-day deals today. In the last 1 year, it has advanced 25 percent and added 36 percent in 2022 YTD.
The stock has risen nearly 3 percent in November so far, extending gains for the fifth straight month since July. Between July-November, the scrip surged 64 percent.
In the 11 months of the calendar year 2022, the stock has given negative returns in just 3 - June (-15 percent), February (-15 percent) and January (-1 percent).
During the quarter under review, revenue from operations was up 17 percent to close at ₹5,956 crore as against ₹5,077 crore in the year-ago period, Apollo Tyres said in a statement.
The company said both Indian and European operations witnessed healthy revenue growth in the second quarter, with Indian Operations growing over 16 percent and European Operations growing more than 30 percent (in local currency terms).
"We continued with our resolve towards profitable growth, despite the headwinds. Our cost control measures, and timely pricing actions, have helped maintain our profitability in a quarter where the raw material prices were at their peak," Apollo Tyres Chairman Onkar Kanwar said in a statement.
While the demand situation in India remained subdued, in Europe the company's growth was better than the market, he noted, adding that with raw material prices tapering off, there is some respite going forward.
“We expect volume improvement in coming quarters on a replacement as well as original equipment manufacturer side at India business, which would aid overall revenue and margins. Moreover, European business would continue to get positive traction with new products and market share gain," said analysts at Reliance Securities in a first-cut note.