Apollo Tyres Ltd Q2 FY26 Earnings Analysis

- Expect improvement in demand momentum in the second half of the fiscal year, especially post-monsoon (Q3 and Q4). - Growth drivers include rebound in infrastructure and mining segments. - India volume growth was flattish Y-o-Y, with low single-digit growth in replacement and mid-single-digit growth in OEM; exports declined significantly. - Market share in PCR is about 20% and in TBR replacement about 30%. - Steps are being taken to address export share decline (currently around 11-12%), with targets to be set in the next 5-year plan. - In Europe, Q2 expected to be better seasonally though market still negative; positive growth likely from Q3 onwards. - Competition in India will increase, but focus on expanding dealer network especially in rural areas. - Medium-term target includes returning to 15% ROCE if current market conditions persist.

- Apollo Tyres expects an improvement in demand momentum in the second half of the fiscal year, particularly post-monsoon, with better demand from mining and infrastructure segments. (Page 4, 15, 16) - In India, the company aims for double-digit growth in truck and PCR segments, with replacement volumes growing mid-single digits (TBR) and low-single digits (PCR). (Pages 9, 15, 16) - European operations anticipate seasonal improvement in Q2 and Q3, but growth returning to positive territory may take longer, with restructuring benefits expected from FY’27 onward. (Pages 9, 15) - Raw material costs expected to be slightly lower in Q2, supporting margin improvement. (Page 4) - Management focuses on profitable growth via new product launches, premiumization, and cost optimization to improve operating earnings and margins. (Pages 3, 9, 16) - Return on Capital Employed (ROCE) is targeted at 15% medium-term, with hopes to resume progress once market conditions stabilize. (Page 8)

- The company continues to closely watch its capex outflow with no change in capex guidance for FY’26. - No specific new strategic or capital investments were highlighted on the call. - Focus remains on profitability, free cash flow generation, and improvement in return ratios as key strategic objectives. - The next 5-year plan is under review, and new targets including potential capital investments will be set as part of that planning process. - Restructuring in Europe continues, with a planned closure of production at the Enschede plant by summer 2026; related costs and social plans are being managed but no direct new investments mentioned. - Emphasis on new product launches, premiumization, and sustainability initiatives suggests ongoing investment in R&D and product development without specific capex numbers disclosed.

- There is no mention of any current or planned new fundraising through debt or equity in the provided transcript. - The management emphasized focusing on reducing consolidated net debt, which was reduced by over 15% in Q1 compared to the previous quarter. - Capex guidance for FY’26 remains unchanged, and there is a close watch on capital expenditure outflow. - The focus continues to be on profitability, free cash flow generation, and improving return ratios. - No indications or discussions about raising new capital through equity or additional debt instruments were highlighted during the call.

The provided transcript from page 17 of the document does not mention any information about the current or expected order book or pending orders. The discussion focuses primarily on export share decline, restructuring in Europe, volume growth, market share, expenses, and outlook on various segments. Therefore, no specific details related to order book or pending orders are available in the provided excerpt.