APL Apollo's sales volume declines to 402,729 ton in Q3FY22; Stock dives 6%

3 Jan 2022 , 12:37 PM

APL Apollo posted a sales volume of 402,729 ton in the quarter ending December 2021 (Q3FY22), declining from 485,579 ton in Q3 of last year and 427,387 tons in Q2FY22.

As per APL Apollo, the Q3FY22 sales volume of 402,729 Ton declined QoQ due to: 1) channel de-stocking in anticipation of steel price correction and, 2) extended monsoons which impacted the construction activity. Moreover, the sales volume in general segment (commoditized sales) was impacted due to rise in price gap between primary steel and scrap steel which benefited the unorganized sector.

The company outlined that its “strategy is to constantly de-commoditize its product portfolio in coming years.”

The value added product portfolio contributed 65% in Q3FY22 vs 62% in Q2FY22 and 60% in Q3FY21.

“We are encouraged to see strong sales growth in the heavy structural steel tubes segment which should drive company’s margins going forward. With the commissioning and ramp-up of new Raipur plant, the sales mix would eventually move towards 75% for value added products,” APL Apollo said.

At around 12.35 pm, APL Apollo was trading at Rs941.35 per piece down by 5.8% on Sensex.