Apollo Pipes Q2 FY27 Results (NSE: APOLLOPIPE)
Signal: Margin pressure
The read
The key inflection is sequential: revenue rose 4.9% QoQ and EBITDA margin recovered to 3.7% from 1.0%, turning PAT from a ₹8.6 Cr Q1FY27 loss to ₹2.0 Cr profit; however, the 31.3% YoY revenue increase came with a roughly 460bps gross-margin compression as raw-material intensity rose to 72.0%, so the recovery is not yet structurally proven.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹309.6 Cr | +31.3% | +4.9% |
| Net profit | ₹2 Cr | +24.0% | |
| EBIT margin | 3.7% |
P&L walk
Consolidated revenue increased 31.3% YoY to ₹309.6 Cr on 13% volume growth, but raw-material intensity rose to 72.0% of revenue from 67.4%, compressing gross margin by about 460bps; EBITDA margin nevertheless recovered sequentially to 3.7% from 1.0%, and PAT improved to ₹2.0 Cr from a ₹8.6 Cr loss in Q1FY27.
Segments
Standalone operations reported a ₹3.7 Cr loss and negative ₹2 Cr EBITDA, while consolidated operations reported ₹2.0 Cr PAT and ₹11.5 Cr EBITDA, showing that subsidiaries materially lifted the group result.
Key positives
- Revenue reached ₹309.6 Cr, up 31.3% YoY, while sales volume increased 13% to 24,501 Ton, implying higher realisation and/or mix contribution.
- EBITDA margin improved 268bps QoQ to 3.7% and EBITDA rose 278% QoQ to ₹11.5 Cr, reversing the weak Q1FY27 operating base.
- PAT improved from a ₹8.6 Cr consolidated loss in Q1FY27 to ₹2.0 Cr profit in Q2FY27.
- Management said polymer-price volatility moderated in Q2 and expects demand recovery and greater PVC-price stability to support H2FY27.
- Capacity is planned to expand from 2,40,000 Ton to 288,000 Ton over the next 2 years, with value-added products and the Mazzini Tiles platform intended to broaden the growth base.
Key concerns
- Gross margin compressed by about 460bps YoY to roughly 28.0% as raw-material expenses rose to 72.0% of revenue from 67.4%, indicating that higher realisation did not fully offset input-cost pressure.
- EBITDA fell 27% YoY to ₹11.5 Cr and EBITDA margin declined 297bps YoY despite 31.3% revenue growth, leaving profitability below the 7-8% margin guidance cited in prior context.
- Net debt increased to ₹98 Cr in H1FY27 from ₹40 Cr in FY26, while H1 operating cash flow of ₹66 Cr was broadly flat versus ₹68 Cr in FY26 and capex was ₹45 Cr.
- Standalone operations generated a ₹3.7 Cr loss and negative ₹2 Cr EBITDA, so consolidated earnings rely materially on subsidiary performance.
- Q2 revenue growth of 31.3% exceeded volume growth of 13%, but the simultaneous gross-margin decline suggests realisation or mix gains were not sufficient to demonstrate durable pricing power.
Research and educational content only. Not investment advice.