Apollo Pipes High Volume Breakout

12 mar 2021

APOLLOPIPE

Fundamentals:-
Apollo Pipes is engaged in the manufacturing and trading of PVC Pipes and Fittings. The company is equipped with state-of-the-art infrastructure, operates large manufacturing facilities at Dadri and Sikandarabad in UP, Ahmedabad – Gujarat and Tumkur – Karnataka, with a total capacity of 100,000 MTPA. The multiple and efficient product profile includes over 1,000 product varieties of cPVC, uPVC, and HDPE pipes, Water storage tanks, PVC taps, fittings and solvents of the highest quality.

Sales and Profit 5 year CAGR at 251% and 167% respectively
Average ROE for last 10, 7, 5 and 3 years greater than 15%
Debt-equity ratio at 0.09, Interest coverage ratio at 9.34 and Current Ratio at 2.83

Future outlook very strong because the Greenfield facility at Raipur is expected to fully operationalise by March 2021. The facility, with a proposed installed capacity of 7,200 MTPA, is strategically located and will help boost volumes in high-potential domestic markets in Central and East India. In addition, the Company is undertaking staggered brownfield expansions at all of its existing facilities across the country, which are also progressing as per schedule.

New product launch
The Company’s latest launched product – water storage tanks has seen strong acceptance in the domestic market and the product contributed to improved sales during the quarter (Dec2020).

The stock has broken out of a two month old resistance zone with good volumes. One can buy with a stop loss below Rs. 750.