Apollo Tyres Q4: 14% revenue growth, Rs 5,800 cr capex

Strong Q4 finish as costs turn volatile again

Apollo Tyres closed the fourth quarter with double-digit consolidated revenue growth and steady operating margins, while flagging near-term cost pressure from raw materials, energy and logistics. Management said demand stayed firm across categories and channels, with April showing “equally strong” volume growth and momentum expected to continue into Q1. At the same time, geopolitical developments in West Asia added volatility, prompting the company to announce calibrated price increases and tighten cost controls. The company also reiterated that capacity utilisation remains high across India and Europe, keeping expansion plans active.

Consolidated performance: revenue at Rs 7,340 crore

For the quarter, consolidated revenue stood at Rs 7,340 crore, reflecting 14% plus growth versus the same quarter last year. Consolidated AITA was Rs 1,070 crore, translating into an AITA margin of 14.6%, compared with 13% in the year-ago period. For the full year, management indicated consolidated topline growth of 9% year-on-year, with an EITA margin of nearly 14.6%. The company also reported consolidated ROCE of 13.4%, an improvement of around 240 basis points compared with FY25.

India business: replacement and OEM volumes in high teens

In India, Apollo said it saw strong double-digit growth in both replacement and OEM (OE) markets in Q4 compared with last year, with “high teens” year-on-year volume growth in replacement and OE segments. Revenue for the quarter from India operations was stated at Rs 5,240 crore, up 14.3% year-on-year and nearly 2% over the previous quarter. AITA for the quarter was Rs 760 crore, with a margin of 14.6%, compared with 11.2% in the same period last year. Management also noted the quarter included higher activation spends related to cricket jersey sponsorship, yet margins were maintained.

Europe: modest revenue, margin improvement and a plant exit

For Europe, the company reported quarterly revenue of €170 million, down 1% year-on-year, citing tough market conditions. EITA for the quarter was €25 million, with a 14.6% margin versus 14.3% in the year-ago period. Separately, another update in the provided material pegged Europe EBITDA at €32 million with a 17.9% margin, indicating stronger profitability in that measure versus the previous quarter.

Apollo said the Enschede plant in the Netherlands is slated to close by the end of June 2026, with the last day of production referenced as June 30. Production is being transitioned to Hungary and India. The company recorded a non-cash write-off of €43 million on fixed assets at the plant during the quarter, tied to the closure plan. Management expects restructuring benefits to begin flowing through from the second half of FY27, while also stating it would not give margin guidance.

Raw material pressure: high-teens sequential rise expected

Apollo warned that raw material costs are expected to rise in the high teens on a sequential basis, which is likely to impact margins in the near term. The company said it is responding through calibrated price increases and disciplined cost control. It also flagged that volatility is not limited to inputs alone, but extends to energy and logistics.

Price hikes: 6% to 8% in India, 2% in Europe

To offset rising costs, Apollo announced price increases of 6% to 8% for the current quarter in India. Management said 3% to 5% has already been implemented in the India market, with the rest coming through in May, describing it as two rounds of increases across product categories. For Europe, the company also announced a 2% price increase.

Utilisation near peak and expansion plans stay on track

Capacity utilisation was reported at around 90% across India and Europe operations. In another update, management said it was running close to 100% utilisation in truck and bus radial tyres, alongside shortages in truck, passenger car and farm segments. With demand outlook described as healthy, Apollo said it expects full capacity utilisation and will continue with planned expansion initiatives.

Capex and investment: Rs 5,800 crore plan over three years

Apollo outlined multiple capex numbers across the provided material:

• Management said it has outlined a FY27 capex of Rs 3,500 crore, with nearly 80% towards growth and capacity expansion.
• Another update said Apollo will invest Rs 5,800 crore over three years to expand passenger car and truck tyre capacity at its Andhra Pradesh plant.
• The board has approved capex for FY27 to FY29, with about Rs 2,000 crore scheduled for FY27 in that plan.
• Total consolidated capex in FY27 was also referenced at about Rs 3,000 crore, including around Rs 700 crore of maintenance and operational spending and ongoing expansion in Hungary.

The India expansion plan described in the material would lift passenger car tyre capacity by 10,500 tyres per day from an existing base of about 58,000 tyres per day (an increase of 17% to 18%). Truck and bus radial capacity of more than 15,000 tyres per day would rise by 3,600 tyres per day (more than 20%). Some capacity is expected to come on stream in FY28, with the full benefit expected by FY30.

Key numbers snapshot

Why the update matters for investors

The quarter combines two opposing forces: demand that management says remains strong, and a cost environment that has turned more volatile. Apollo’s response has been to push pricing and keep a tight grip on costs, while simultaneously committing to capacity expansion where utilisation is already high. The Europe restructuring and the non-cash write-off underline that the company is still recalibrating its cost base in that region. Meanwhile, high utilisation and expansion timelines extending into FY28 and FY30 indicate that supply constraints and execution on projects will remain central to near-term monitoring.

What to watch next

Apollo has pointed to strong April volumes and expects momentum to continue through Q1, but also expects margin pressure in India as cost inflation filters through. Investors will track how quickly the announced price hikes translate into realised pricing, and whether cost volatility persists. On Europe, the June 2026 Enschede shutdown and the transition of production to Hungary and India are key milestones, with management expecting restructuring benefits from H2 FY27.

Conclusion

Apollo Tyres reported 14% plus consolidated revenue growth in Q4 with a 14.6% AITA margin, backed by strong India volumes and steady profitability. Near-term margins face pressure from a high-teens sequential rise expected in raw material costs, prompting price increases in India and Europe. The company is simultaneously moving ahead with a multi-year capex plan and a Europe restructuring that includes closing the Enschede plant by the end of June 2026, with benefits expected to start reflecting from the second half of FY27.