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Europe demand remains weak
View Risks →Apollo Tyres Limited — Q3 FY26
Apollo Tyres reported a strong Q3 FY26 with consolidated revenue of ₹7,740 crore (+12% YoY) and EBITDA margin of 15.3% (+160 bps YoY), driven by robust domestic demand across all channels and categories.
bullish
high
Financial stats pending filing verification
2-Minute Summary
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Apollo Tyres reported a strong Q3 FY26 with consolidated revenue of ₹7,740 crore (+12% YoY) and EBITDA margin of 15.3% (+160 bps YoY), driven by robust domestic demand across all channels and categories. India revenue grew 13%+ to ₹5,140 crore, with mid-teens volume growth and exports up nearly 20%. Europe remained flattish due to muted demand. The company announced a ₹5,800 crore CapEx plan for Andhra Pradesh over FY27-29 to address capacity constraints (India utilization in high 80s). A&P spend spiked to ~₹150 crore due to BCCI sponsorship activation, but is expected to normalize to 2.5% of sales. Raw material costs are expected to remain steady in Q4. Risk: Europe demand recovery remains uncertain and could delay margin improvement.
अपोलो टायर्स ने वित्त वर्ष 2026 की तीसरी तिमाही में मजबूत प्रदर्शन किया। कंपनी की कुल कमाई ₹7,740 करोड़ रही, जो पिछले साल से 12% ज्यादा है। कमाई पर खर्च घटाने के बाद बचत (EBITDA मार्जिन) 15.3% रही, जो पिछले साल से 1.6% बेहतर है। इसकी वजह देश में टायरों की जबरदस्त मांग है। भारत में कमाई 13% बढ़कर ₹5,140 करोड़ हुई, और निर्यात लगभग 20% बढ़ा। यूरोप में मांग कमजोर रहने से वहां कारोबार स्थिर रहा। कंपनी आंध्र प्रदेश में नया कारखाना बनाने के लिए ₹5,800 करोड़ खर्च करेगी ताकि उत्पादन बढ़ाया जा सके। विज्ञापन पर खर्च बढ़ा है, लेकिन जल्द ही सामान्य हो जाएगा। कच्चे माल की लागत स्थिर रहने की उम्मीद है। जोखिम: यूरोप में मांग सुधरने में देरी हो सकती है।
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Read Transcript →Quarter Snapshot
India volume growth
mid-teens
+mid-teens YoY
India standalone volume growth in Q3 was in mid-teens year-over-year, driven by strong double-digit growth across all categories.
Exports growth
~20%
+~20% YoY
Exports from India grew just short of 20% year-over-year in Q3.
Europe UHP mix
52%
+4pp YoY
Ultra-high performance tire mix in Europe increased to 52% from 48% in the same quarter last year.
India capacity utilization
high 80s%
flat
Overall India operations capacity utilization is in the high 80s for both car and truck tires, nearing constraints.
What Changed vs Last Quarter
NEW
CapEx of ₹5,800 crore for Andhra Pradesh expansion over FY27-29
Board approved ₹5,800 crore CapEx for expanding PCR and TBR capacities in Andhra Pradesh, spread over FY27-29, with growth CapEx of ~₹2,000 crore in FY27.
NEW
Consolidated CapEx of ~₹3,000 crore in FY27
Overall consolidated CapEx for FY27 is expected to be around ₹3,000 crore, including Hungary expansion and maintenance.
NEW
A&P spend to normalize to 2.5% of sales
A&P spend as a percentage of sales will increase to about 2.5% in a normalized scenario, up from ~2% historically, to drive top-line growth.
UPDATED
Enschede plant closure by end June 2026
The Netherlands plant will stop production by end of June 2026, with benefits expected to flow from H2 FY27.
DROPPED
H2 revenue growth to sustain or improve
Management expects Q3 revenue growth to be at least at Q2 levels, driven by GST benefits and brand investments.
DROPPED
EBITDA margin to sustain or improve in H2
Profitability expected to remain at current levels or improve, supported by stable raw material costs and operating leverage.
DROPPED
India replacement demand to grow mid-to-high single digits
Replacement demand expected to improve from current low levels to mid-to-high single digit growth.
NEW RISK
Europe demand remains weak
Europe market growth was -4% in Q3, and recovery is uncertain; continued weakness could delay margin improvement.
NEW RISK
High CapEx may pressure ROCE
The large CapEx cycle could temporarily depress ROCE, which is currently 13.5%, below the 15% target.
NEW RISK
A&P spend spike may persist
Elevated A&P spend due to BCCI sponsorship may take time to normalize, impacting near-term margins.
RISK GONE
New entrant competition in India
A financially strong new player is entering PCR and TBR segments, potentially increasing competitive intensity and pricing pressure.
RISK GONE
European demand recovery uncertainty
European market remains challenging with low single-digit growth expected; recovery is not yet assured.
RISK GONE
OEM share loss in PCR
Apollo lost ground in PCR OEM shares due to not bidding for certain unprofitable businesses, which may impact future volumes.
Fast read
Guidance and risk preview
Board approved ₹5,800 crore CapEx for expanding PCR and TBR capacities in Andhra Pradesh, spread over FY27-29, with growth CapEx of ~₹2,000 crore i...
Europe market growth was -4% in Q3, and recovery is uncertain; continued weakness could delay margin improvement.
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