UPL vs Apl Apollo Tubes Q4 FY26

UP

UPL

Q4 FY26 · Other

UPL delivered a strong FY26 with revenue up 11% to ₹52,000 crore and EBITDA up 18%, driven by volume-led growth across all regions and platforms. Contribution margin expanded 220bps to 31.5% in crop protection, while net debt/EBITDA fell to 1.6x from 2.1x. The company provided a Q1 FY27 guidance of 10-14% revenue growth and 14-18% EBITDA growth, citing cautious optimism despite Middle East supply disruptions. A key risk is the elevated ECL provision of ₹350 crore in Q4, reflecting credit stress in Latin America. Management also announced a reorganization to unlock value in Advanta and Superform, though some investors raised concerns about shareholder dilution.

Guidance read

Q1 FY27 Revenue Growth 10-14%: Management guided Q1 FY27 revenue growth of 10-14% YoY, driven by volume and price, with FX tailwind of 7-9%. Q1 FY27 EBITDA Growth 14-18%: EBITDA growth guided at 14-18% for Q1 FY27, reflecting operating leverage despite seasonally low quarter. Capex Guidance $300-350M for FY27: Capex expected to increase to $300-350 million from $261 million in FY26, focused on specialty chemicals and backward integration. Net Debt/EBITDA Target 1.2-1.5x Medium Term: Target leverage ratio of 1.2-1.5x in the medium term, with current at 1.6x; will maintain optimal capital structure.

Risk read

Key risks include Middle East Supply Chain Disruption — Geopolitical tensions could increase raw material costs and working capital needs; management is managing via disciplined sourcing and pricing.; Elevated Credit Loss Provisions in LatAm — Q4 ECL provision of ₹350 crore (full year ₹750 crore) reflects credit stress in Latin America; analyst questioned if this is the new normal.; Shareholder Dilution from Reorganization — Analyst raised concern that the proposed demerger structure could trigger a conglomerate discount and dilute existing shareholders.; Fertilizer Price Impact on Farmer Economics — Higher fertilizer costs may reduce farmer incomes and potentially lower agrochemical consumption, though management expects crop protection demand to hold..

Promise ledger

Scorecard data is being built as historical quarters are processed.

APL Apollo reported a strong Q4 FY26 with 9% volume growth YoY and EBITDA per ton exceeding ₹5,500, driven by market leadership, product innovation, and steel shortages. Full-year operating cash flow was ₹20 billion and free cash flow ₹13 billion, with net cash of ₹15 billion+. However, the Middle East crisis, gas shortages, and steel price volatility disrupted operations, particularly in Dubai (40% utilization) and domestic galvanized lines. Management maintains FY27 guidance of 15-20% volume growth and 20-25% PAT growth, focusing on margin protection over volume. Risks include prolonged geopolitical disruption, energy shortages, and potential demand slowdown from construction site halts.

Guidance read

Volume growth 15-20% in FY27: Management targets 15-20% volume growth for FY27, with a focus on margin protection. PAT growth 20-25% in FY27: PAT growth target of 20-25% for FY27, supported by margin expansion. EBITDA per ton sustainable at ₹5,000-5,500: Management expects EBITDA per ton to remain in the ₹5,000-5,500 range going forward. Capex of ₹14,500 crore for 8 MTPA capacity by FY28: Total capex of ₹14,500 crore over next 2.5 years to reach 8 million tonnes capacity by FY28.

Risk read

Key risks include Prolonged Middle East crisis — The ongoing war has disrupted global supply chains and impacted Dubai operations at 40% utilization.; Energy shortages in India — Gas shortages caused temporary shutdowns in March; fear of recurrence may limit production to 80-85%.; Demand slowdown from construction halts — Construction sites halted due to labor shortages and raw material price inflation, delaying purchases.; Steel price volatility and inventory risk — Rapid steel price increases may lead to destocking; however, low inventory days mitigate mark-to-market risk..

Promise ledger

Scorecard data is being built as historical quarters are processed.