Apollo Tyres, a leading tyre manufacturer, reported a 13.7% decline in net profit for the January-March quarter of the fiscal year 2023-24 (FY24). The company’s net profit for this quarter was Rs 354 crore, down from Rs 410.30 crore in the same period the previous year.
In a filing with the stock exchange, Apollo Tyres announced a recommendation for a dividend of Rs 6 per equity share (600% of the face value of Rs 1 each) for FY24. This recommendation is subject to shareholder approval at the upcoming Annual General Meeting (AGM). If approved, the dividend will be paid or dispatched within 30 days of the AGM’s conclusion.
Despite the drop in net profit, Apollo Tyres posted a slight increase in revenue from operations. The revenue for the January-March quarter stood at Rs 6258.20 crore, marginally higher than the Rs 6247.33 crore recorded during the same period last year.
The company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) showed a year-on-year increase of 3%, reaching Rs 1028 crore. This indicates some operational improvements despite the overall decline in net profit.
The financial performance of Apollo Tyres reflects a mixed bag of results. The slight growth in revenue and the increase in EBITDA suggest operational resilience, while the decline in net profit highlights challenges the company faced in the last quarter of FY24.
Apollo Tyres’ board’s decision to recommend a substantial dividend indicates confidence in the company’s long-term prospects and a commitment to returning value to shareholders. The approval of this dividend will be a key point of interest at the forthcoming AGM.
The company has not provided specific reasons for the decline in net profit, but such changes often result from various factors, including fluctuating raw material costs, changes in demand, and operational efficiencies. The marginal increase in revenue suggests that the company is maintaining its market position despite these challenges.
Looking ahead, Apollo Tyres will likely focus on strategies to improve profitability while maintaining revenue growth. The automotive industry, in which Apollo Tyres operates, continues to face various market dynamics, including changes in consumer preferences and global economic conditions. How the company navigates these factors will be crucial for its financial performance in the coming quarters.
In summary, Apollo Tyres has reported a 14% drop in net profit for Q4 FY24, with slight revenue growth and an increased EBITDA. The proposed dividend reflects confidence in the company’s future, and the upcoming AGM will be pivotal in determining shareholder sentiment and approval.
