Summary
Apollo Pipes Limited - Q3 FY2026 Earnings Call Summary Friday, January 30, 2026 11:30 A.M. IST
Event Participants
Executives 4 Ajay Kumar Jain (CFO), Anubhav Gupta (Group CSO), Arun Agarwal (JMD), Sameer Gupta (CMD)
Analysts 6 Fenil (Choice Institutional Equities), Kaustav (BMSPL), Manish Mahawar (Antique Stock Broking), Nikhil (Money Stories), Priyanshu (Omega Portfolio Advisors), Saikrishna (Individual Investor)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Sales Volume (Consolidated) | 22,000 - 23,000 MT | Flattish YoY for 9M FY26; Housing segment grew +10% YoY while Agri/HDPE declined. |
| EBITDA Spread (Standalone) | ₹6,500 per ton | Down from ₹9,000-10,000 range; Impacted by inventory losses and higher employee costs. |
| EBITDA Spread (Kisan) | Negative (Loss) | Significantly below FY25 peak of ₹5,000/ton due to low utilization and inventory write-downs. |
| CPVC Volume | +10% YoY | Growth driven by Housing segment focus and Lubrizol partnership. |
| Inventory Days | 80 days | Elevated as of Dec-25; Management targets reduction to 60 days by Mar-26 via higher Q4 sales. |
| 9M FY26 Capex | ₹125 crores | Part of a larger ₹150 crore FY26 plan; focuses on Varanasi plant and capacity upgrades. |
| Inventory Loss | ~₹5 crores (₹50M) | Result of sharp PVC resin price decline of ₹11/kg during Q3 FY26. |
Geographic & Segment Commentary
- North India: This remains the core market contributing 60%-65% of total revenue; management noted a revival in demand starting late December.
- West India (Kisan/Tarapur): Integration is now complete after 22 months; plant currently operates at 40% utilization with a target to reach 70% (35k-40k tons) in 2 years.
- East India (Varanasi): New plant is on track to commence in February/March 2026 to capture “virgin” markets in Eastern UP and Bihar.
- Housing & Plumbing: Represents 60% of business; grew 10%+ YoY in 9M FY26 despite macro headwinds, with a long-term goal to reach 75% of sales mix.
Company-Specific & Strategic Commentary
- Product Expansion: Forayed into UPVC doors and windows and added value-added products like PLB ducts, DWC pipes, and PVC-O pipes to diversify beyond generic piping.
- Lubrizol Tie-up: Strengthening presence in the high-margin CPVC category through a joint market pitch with Lubrizol, currently 15% of volume.
- Market Share Strategy: Management adopted aggressive pricing in Q3 to gain market share, accepting short-term margin pressure to drive long-term operating leverage.
- Operational Integration: Completed full system integration (Finance, IT, Procurement) of Kisan Mouldings; shifting Kisan’s mix from 70% Agri to 60% Housing over 3-4 years.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Q4 FY26 Volume | 32,000 - 35,000 tons | Based on 25% YoY growth seen in Jan-26 and seasonality in real estate/Agri. |
| FY26 Total Volume | 106,000 - 107,000 tons | Up from 99,000 tons in FY25; implies high single-digit annual growth. |
| FY27 Capex | ~₹100 crores (Consol) | Includes ₹25-30cr for South India land and ₹50cr for brownfield expansion. |
| FY27 EBITDA Margin | ₹9,000 - 10,000 / ton | Targeted recovery as inventory losses subsidize and operating leverage kicks in. |
Risks & Constraints
| Risk | Context |
|---|---|
| Raw Material Volatility | PVC resin prices fell from ₹72/kg to ₹61/kg in Q3 before rebounding to ₹68/kg; sharp swings trigger dealer de-stocking and inventory losses. |
| Government Spending | Demand for water infrastructure and government CAPEX has been stagnant for 24 months; EPC contractor cash flows remain a bottleneck. |
| Intense Competition | Heightened pricing wars from both smaller unorganized players and industry leaders are compressing EBITDA spreads in the short term. |
Q&A Highlights
Demand & Recovery
- Question: What gives confidence in the high Q4 volume target after a flat 9M? (Utkarsh, Anand Rathi)
- Answer: Growth has already hit 25% YoY in the first 6 weeks of the quarter (Jan-26); seasonality and aggressive Q3 pricing are now converting to orders (Anubhav Gupta).
PVC Pricing
- Question: What is the status of the Anti-Dumping Duty (ADD) on PVC? (Kaustav, BMSPL)
- Answer: The case was automatically withdrawn as timelines for final findings expired; any new ADD investigation would take at least 6-9 months to restart (Sameer Gupta).
Kisan Mouldings Integration
- Question: Is there a plan for a full merger of Kisan? (Priyanshu, Omega Portfolio Advisors)
- Answer: The intent remains to merge Kisan into Apollo Pipes; timing depends on when the plant reaches full operational stability (Anubhav Gupta).
Warrants & Funding
- Question: Why has only 25% of warrant money been received? (Priyanshu)
- Answer: This is as per the agreement with Kitara Capital (25% upfront, 75% within 18 months); the remaining ~₹82 crores is expected by October 2026 (Anubhav Gupta).
Key Takeaway
Apollo Pipes reported a challenging Q3 FY26, characterized by flattish 9-month volumes and margin compression (EBITDA spread falling to ₹6,500/ton) due to a ₹11/kg crash in PVC resin prices. Despite these headwinds, the core Housing segment maintained 10% YoY growth, and management successfully completed the 22-month integration of Kisan Mouldings. Strategically, the company is shifting its mix toward high-margin Plumbing and CPVC (supported by the Lubrizol tie-up) while expanding its footprint via the upcoming Varanasi plant. Management expects a significant recovery in Q4 FY26, guiding for record volumes of 32k-35k tons driven by early Q4 momentum (+25% YoY in January) and aggressive market share acquisition. While PVC price volatility remains a structural risk, the company’s focus on diversifying into value-added segments like UPVC windows and DWC pipes aims to stabilize long-term profitability as they target a consolidated capacity of 286,000 tons.
Want more insights like this?
Subscribe to get deep dives delivered to your inbox.
More Earnings Summaries
Explore more Q3 FY26 earnings call analyses: