Apollo Tyres Q2 FY27 Results (NSE: APOLLOTYRE)

4 Nov 2026 · Analysis by Alpha Inflection

Signal: Margin pressure

The read

The quarter marks a reversal from the margin expansion seen in Q2FY26-Q4FY26: revenue growth accelerated to 16.6% YoY, but operating margin fell 421bps to 10.73% as material costs reached 53.23% of revenue; the 13.3% PAT growth is therefore lower quality because it was supported by the exceptional charge falling to ₹268.53 million from ₹1,800.37 million.

P&L walk

Consolidated revenue rose 16.6% YoY to ₹79,681.50 million, but gross margin fell to 38.45% as raw-material cost increased to 53.23% of revenue from 46.38%; EBITDA margin declined to 10.73%, while PAT rose 13.3% because the exceptional charge fell to ₹268.53 million from ₹1,800.37 million.

Segments

APMEA drove the group, with revenue up 23.8% YoY to ₹59,732.34 million and segment result down 12.4% to ₹4,616.95 million; Europe revenue fell 1.6% and result fell 46.1%, while Others revenue plunged 77.2% and result fell 92.3%.

Key positives

• Consolidated revenue reached ₹79,681.50 million, up 16.6% YoY and 7.7% QoQ, with APMEA revenue up 23.8% YoY to ₹59,732.34 million.
• H1 capex accelerated to ₹18,784.31 million from ₹5,701.76 million, while capital work-in-progress rose to ₹23,242.55 million from ₹9,179.01 million.
• Finance costs declined 6.7% YoY to ₹942.39 million and consolidated EPS rose 13.5% YoY to ₹4.62.

Key concerns

• EBITDA margin fell 421bps YoY to 10.73% and 100bps QoQ as material cost rose to 53.23% of revenue from 46.38% a year earlier.
• Europe segment result fell 46.1% YoY to ₹520.57 million despite only a 1.6% revenue decline, indicating significant regional margin pressure.
• Operating cash flow fell to ₹2,641.95 million in H1FY27 from ₹13,153.70 million, while inventories absorbed ₹6,064.72 million and trade receivables absorbed ₹6,968.10 million.

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