By CNBCTV18.com Nov 28, 2022 12:48:57 PM IST (Published)
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As a result of this upgrade, shares of Apollo Tyres gained as much as 6 percent on Monday to hit a new 52-week high.
The brokerage expects that easing commodity prices will support the tyre maker’s gross margins.
UBS expects Apollo Tyres' EBITDA margin to grow to 13.5 percent in the next financial year and 14 percent in the financial year 2025. For the September quarter, the company's EBITDA margin stood at 10.3 percent.
Apollo Tyres' Return on Equity (RoE) is also likely to double to 13 percent by the financial year 2025, compared to 6 percent in the previous financial year. It also expects net debt to fall to Rs 2,600 crore within the next two financial years from Rs 5,500 crore in the last financial year.
Shares of Apollo Tyres are trading 5.78 percent higher at Rs 310.15.
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