Apar Industries tanks 18% as investors rush to book profit from recent rally
Operating margin expanded to 10.7 percent in the quarter ended March 2023 from 6.1 percent in the corresponding period last year.
Investors seem to be booking profits after the recent rise in shares of Apar Industries, analysts said. The stock tanked 18 percent intraday so far after a 10 percent rise in the stock price on May 8.
At 1:15am, the stock was quoting at Rs 2,600.00, down Rs 452.40, or 14.82 percent. The stock was trading with volumes of 47,136 shares, as compared with its five day average of 17,833 shares, an increase of 164 percent.
In the past one year, the stock has risen over 300 percent and is up closer to 800 percent in the past three years.
Revenue from operations came in at Rs 4,088.58 crore in the quarter ended March as compared with Rs 3,012.45 crore posted a year ago, on the back of volume-led growths across all divisions and growth in export of cable and conductor businesses. Net profit stood at Rs 247.23 crore in the quarter under review against Rs 123.30 crore.
EBITDA margin expanded to 10.7 percent in the quarter ended March 2023 from 6.1 percent in the corresponding period last year.
However, the near term inventory adjustment will impact conductor business and the exceptional high EBITDA per tonne is not sustainable but that is already known, some analysts pointed out.
Brokerage house Prabhudas Lilladher has revised its FY25 estimates by 11.2 percent, given strong exports outlook with further penetration in high growth markets along with robust cable segment outlook amid high elastomeric cables contribution.
“We believe, APR’s (Apar Industries) focus towards value added products and strong traction in exports business will drive strong topline and profitability in the long run,” the brokerage firm said in a result update note.
The stock is currently trading at PE of 20.9 times its FY24 earnings and 16.6 times FY25. It has suggested ‘buying’ the stock as compared to ‘Under Review’ earlier with a target price of Rs 3,832.
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