Apar Industries Ltd – Equity Research Style Snapshot (Updated to FY26 numbers)

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1. Company Snapshot

- Business: Apar Industries Ltd (APAR) is a diversified electrical and industrial products company with three core segments:

- Conductors

- Transformer & Speciality Oils (TSO)

- Power & Telecom Cables (including renewable/solar, wind, and specialty cables) (screener.in)

- Positioning:

- World’s largest aluminium & alloy conductor manufacturer.

- India’s largest and world’s 3rd largest transformer oils manufacturer.

- India’s largest exporter/producer of speciality and renewable cables.

- Presence in 140+ countries with 9 plants in India and 1 in Sharjah, UAE. (apar.com)

- Scale:

- FY24 revenue from operations ~₹16,153 crore, with ~13% YoY growth. (stockanalysis.com)

- FY26 revenue from operations ~₹22,902 crore, net profit ~₹977 crore. (screener.in)

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2. Business Mix & Markets

- Segments (consolidated, broad mix):

- Conductors: Largest segment; ~51% of revenue in FY26 (up from 48% in FY25). (screener.in)

- Transformer & Speciality Oils: One of the largest global transformer oil players; strong presence in power, industrial and automotive oils. (apar.com)

- Cables & Telecom: Power, renewable (solar/wind), EHV, railway, and hybrid copper-fibre telecom cables; positioned as a key enabler of grid and energy-transition capex. (apar.com)

- Geographical Split (FY24):

- Revenue ~₹16,153 crore with ~45.2% exports, 54.8% domestic – meaning APAR is almost half export-driven, de-risking it from purely Indian capex cycles. (apar.com)

- Industry Context:

- India’s energy consumption expected to grow ~4–5% annually over the next five years, with strong government focus on transmission, renewables and grid strengthening – all directly benefiting conductors, cables, and transformer oils. (apar.com)

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3. Financial Performance (Consolidated)

3.1 Revenue & Profit Trend (₹ crore)

| Fiscal year (Mar-end) | Sales / Revenue from Ops | Net Profit (PAT) | Net Margin | Key Comment |

|-----------------------|--------------------------|------------------|-----------|-------------|

| FY22 | ~9,317 | 257 | ~2.8% | Strong recovery phase post-Covid. (screener.in) |

| FY23 | ~14,336 | 638 | ~4.5% | 54% YoY revenue growth; margin lift. (screener.in) |

| FY24 | ~16,153 | 825 | ~5.1% | 13% revenue, 29% PAT growth; highest-ever revenue. (screener.in) |

| FY25 | ~18,581 | 821 | ~4.4% | Revenue +15%, PAT broadly flat; some margin pressure. (screener.in) |

| FY26 | ~22,902 | 977 | ~4.3% | Revenue +23%, PAT +19%; top-line momentum continues. (screener.in) |

Key points:

- 5-year revenue CAGR ~29%; 5-year profit CAGR ~44%, indicating strong operating leverage scaling from FY22 onwards. (screener.in)

- Operating margin (OPM) moved from ~6–7% range historically to ~9–10% in FY23–24, moderating to ~8–9% in FY25–26 as input and mix normalised. (screener.in)

- ROCE remains high: ~44% in FY23, ~33% in FY25, ~31% in FY26, signalling efficient capital use despite rising capex and working capital. (screener.in)

3.2 Segment Highlights (FY23–24 snapshot)

- Conductors:

- FY24 revenue ~₹8,031 crore (~14% YoY growth), all‑time high; ~45% from premium products (HTLS, HVDC, specialised conductors). (apar.com)

- Strong position in reconductoring and high-voltage transmission projects in India and overseas. (screener.in)

- Speciality Oils & Lubricants:

- Large domestic market share in transformer oils; volume and EBITDA growth in FY24 driven by export markets and premium eco-friendly oils. (apar.com)

- Cables & Telecom:

- Growing faster than legacy segments, supported by renewable energy (solar/wind cables), data/telecom, railways and infrastructure spending. (apar.com)

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4. Balance Sheet & Cash Flows

- Capital Structure:

- Equity + reserves grew from ~₹2,236 crore in FY23 to ~₹5,393 crore in FY26, aided partly by strong retained earnings and a ₹1,000 crore QIP in FY24 to strengthen working capital and de‑lever the balance sheet. (apar.com)

- Borrowings increased from ~₹376 crore in FY23 to ~₹956 crore in FY26, but given higher equity base, gross D/E remained sub‑0.2x throughout FY24–26 – conservative leverage for this scale. (screener.in)

- Cash Flows:

- CFO was negative in FY24 (‑₹283 crore) due to working capital build-up amid rapid growth and export-heavy mix, but rebounded sharply to ₹1,291 crore in FY25 and ₹968 crore in FY26. (screener.in)

- Free cash flow was negative in FY24 but turned positive again in FY25–26, indicating better receivables/payables and inventory management after a stress year. (screener.in)

- Return Ratios:

- 10‑year average ROE ~20%; ROE for FY26 ~20% on a much expanded equity base. (screener.in)

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5. Shareholding & Governance

- Shareholding pattern (Mar 2026, consolidated): (screener.in)

- Promoters: 57.77%

- FIIs: ~9.38%

- DIIs (incl. mutual funds, insurance, other institutions): ~24.15%

- Public/Retail: ~8.71%

High, stable promoter stake plus rising institutional ownership (both FIIs and DIIs) over the last few years reflects growing institutional comfort with the business model and governance standards. (screener.in)

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6. Valuation Snapshot (as of early July 2026)

From Screener (close price on 3 July 2026): (screener.in)

- Current Market Price: ~₹14,174 per share

- Market Capitalisation: ~₹56,943 crore

- Trailing P/E: ~56.9x

- P/B: ~10.6x (Book value ~₹1,343)

- Dividend Yield: ~0.36%

- ROE (latest year): ~20.2%

- ROCE (latest year): ~31.1%

Interpretation (illustrative, not advice):

- The stock is trading at a high earnings and book multiple, implying the market is discounting sustained high growth and returns, as well as strong sector tailwinds (power T&D, renewables, cables).

- Any slowdown in growth, compression in margins, or policy/commodity headwinds can lead to valuation de-rating from these elevated levels.

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7. Key Investment Positives (for analysis)

(These are analytical points, not recommendations.)

1. Structural Tailwinds

- Beneficiary of long-cycle investments in power transmission, renewables, railways and telecom – both in India and overseas. (apar.com)

2. Market Leadership & Product Depth

- Global leadership in aluminium conductors and significant share in transformer oils and speciality cables provides scale, brand, and technical moats vs. smaller peers. (apar.com)

3. Strong Financial Track Record

- Sales up from ~₹7,964 crore (FY19) to ~₹22,902 crore (FY26); PAT from ~₹136 crore to ~₹977 crore over the same period; high ROCE and ROE metrics. (screener.in)

4. Diversified Revenue Base

- Balanced across conductors, oils and cables, plus nearly half of revenue from exports; reduces dependence on any one geography or product category. (apar.com)

5. Improving Balance Sheet

- Post‑QIP, leverage remains modest; rating agencies have taken note of the strengthened capital structure and scale. (apar.com)

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8. Key Risks & Monitorables

1. Commodity Price & Forex Risk

- Copper and aluminium are core raw materials; volatility in LME prices and currency moves can compress spreads if not passed through timely. (en.wikipedia.org)

2. Working Capital Intensity

- Business is inherently working‑capital heavy due to large project orders, exports, and government/utility customers; receivable cycles can stretch during macro stress, impacting cash flows (seen in FY24). (screener.in)

3. Margin Normalisation

- OPM has already moderated from peak ~10% to ~8–9%; further normalisation, competitive intensity, or adverse product mix shift could affect earnings growth even if revenues grow. (screener.in)

4. Cyclicality & Policy Dependence

- Demand is closely tied to power grid, infra, and renewable capex cycles, which are driven by government policy, tariff structures, and utility financial health.

5. Valuation Risk

- At ~57x trailing P/E and >10x P/B, any disappointment versus high growth expectations can cause sharp price corrections, independent of long-term fundamentals. (screener.in)

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9. Analytical Summary (Non‑Advisory)

- Apar Industries has transformed from a mid-sized cable/oil company into a large-cap, globally relevant power infrastructure enabler with:

- Strong revenue growth,

- High capital efficiency (ROCE/ROE),

- And improving balance sheet quality.

- The business is well-aligned with India’s and global energy-transition themes (renewables, grid modernisation, transmission reconductoring, telecom/data).

- However, from an analytical standpoint, the current valuation already embeds:

- High growth in revenue,

- Sustained mid‑single digit net margins,

- And continued benign credit/commodity conditions.

Analysts typically track:

- Order book and order inflows in conductors and cables,

- Export/domestic mix and pricing trends,

- Working capital and cash flow evolution,

- Any capacity expansion or new product introductions in value‑added segments.

For stock-specific action (buy/hold/sell), you should evaluate your own risk profile, time horizon, and consult a SEBI-registered investment adviser or broker with access to your full financial situation.

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