Apar Industries Ltd Q4 FY25 Earnings Analysis

- Cable division top-line growth guidance: 25% in value terms (blended domestic and global markets). - Conductor division volume growth guidance: approximately 10%. - Oil division volume growth guidance: 5-8%. - Domestic market growing faster relative to exports, with export mix expected to vary based on margin and external factors like U.S. demand. - Wire segment growing strongly, with a 46% growth in 9 months FY'25 vs FY'24, expanding distribution by 67%, retail presence doubled, expected to become an INR 300+ crore business. - Sector outlook positive: pent-up demand in transmission lines and substations expected to result in catch-up in execution and order inflow. - U.S. market presents significant room to grow, currently less than 1% of $20 billion imported cables. - Government capex in power transmission likely stable or increasing to support renewable energy expansion.

- APAR Industries continues to hold its earlier guidance for growth and margins, indicating steady future performance. - Cable division is expected to grow topline at 25% value terms annually. - Conductor division volume growth is guided at around 10% per annum. - Oil division is expected to grow 5-8% volume-wise in the coming year. - Management remains optimistic about expanding premium product sales domestically and increasing export market share, especially in the U.S. - EBITDA margins target is around 11-12%, with efforts underway to improve productivity via Industry 4.0 initiatives. - Despite short-term fluctuations due to freight and forex, business fundamentals, including electrification and renewable growth, support ongoing profit growth. - The company expects year-on-year growth across all businesses, driven by strong domestic demand in renewables, railways, defense, and export market development.

- Capex of about INR 270 crores has been done till 9 months of FY25; budget for FY26 is being finalized soon. (Page 21) - Strong order flow in the conductor business expected to continue based on existing orders at capex and EPC levels, supporting business for FY26 and beyond. (Page 26) - Industry 4.0 program underway in the Cable business: over 400 machines to be connected to the platform by end of March, aimed at improving efficiencies. (Page 12) - No specific new large-scale strategic investments mentioned, but emphasis on innovation, product differentiation, and growing approvals and presence in U.S. market to expand business. (Page 8, 12) - The company is enhancing its capabilities in the U.S. through increased manpower and infrastructure to service the market better. (Page 16)

- No specific mention of any new fundraising through debt or equity in the Q3 FY25 earnings call. - Current borrowings: Short-term debt around INR 120 crores and long-term debt about INR 330 crores. - Interest-bearing acceptances have been reduced from around INR 4,000 crores to INR 2,500 crores, indicating optimization of working capital and debt reduction. - Capex for 9 months is about INR 270 crores; budget for FY26 is in the process of being finalized. - No explicit commentary on raising fresh debt or equity; focus appears on internal cash generation and working capital optimization for funding. - Management did not indicate plans for new fundraising, suggesting reliance on existing financial resources and operational cash flow.

- The current order book stands at a healthy INR 7,600 crores (Page 6). - New orders received during the quarter were INR 3,077 crores, a 62.3% increase YoY (Page 6). - There is significant pent-up demand compared to the Central Electricity Authority's (CEA) declared plans, with execution running at roughly 50% for transmission lines and 65% for substations (Pages 33-34). - Some tenders are delayed, retendered, or recently finalized, indicating pending execution growing from caught-up demand (Pages 33-34). - The business is expected to have good order flow for the whole next financial year and beyond, supported by orders placed at the capex level and EPC community (Page 26). - Tendering activity is ongoing with government awareness of the need to evacuate power from new renewable generation sites, ensuring steady future order inflows (Page 35).