Apar Industries Limited — Q2 FY26 earnings call

Call held 30 Oct 2025

Management summary

Apar Industries delivered strong Q2 FY26 results, with consolidated revenue growing 23.1% YoY to ₹5,715 crores and PAT increasing 30% to ₹252 crores. Both conductor and cable divisions showed robust growth, driven by domestic performance and significant export expansion, particularly to the US. While the company faces short-term headwinds from metal price volatility and US tariffs impacting Q3 order execution, management remains optimistic about long-term growth drivers like renewable energy and grid infrastructure, supported by ongoing capacity expansion plans.

Highlights

  • Consolidated revenue of ₹5,715 crores, up 23.1% YoY.

  • Consolidated EBITDA post forex of ₹499 crores, up 24% YoY, with a margin of 8.7%.

  • Consolidated PAT of ₹252 crores, up 30% YoY, with a margin of 4.4%.

  • H1 FY26 consolidated revenue crossed ₹10,000 crores for the first time, reaching ₹10,820 crores, up 25% YoY.

  • Conductor division revenue grew 34.9% YoY, with EBITDA per metric ton at ₹39,636.

  • Cable division revenue grew 25.1% YoY to ₹1,535 crores, with EBITDA margin at 10.2%.

  • Total order book for conductor division stands at ₹7,168 crores, with new orders of ₹5,256 crores in H1.

  • Cable division pending order book is ₹1,836 crores.

Concerns

  • US Tariffs (Section 232)

Key financials

  1. Consolidated Revenue ₹5,715 Cr +23.1%YoY
  2. Consolidated EBITDA ₹499 Cr +24%YoY
  3. Consolidated EBITDA Margin 8.7%
  4. Consolidated PAT ₹252 Cr +30%YoY
  5. Consolidated PAT Margin 4.4% +0.2%YoY

What they filed

Q1 FY27: revenue up 29.1%, net profit up 77.6% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue4,645 4,716 5,210 5,104 5,715 +23%5,480 +16%6,603 +27%6,591 +29%
EBITDA357 356 455 452 465 +30%452 +27%496 +9%758 +68%
Net profit194 175 250 263 252 +30%209 +19%253 +1%467 +78%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

SegmentRevenue GrowthVolume GrowthExport ContributionEBITDA
Conductor Division (Q2 FY26)34.9%16.2%24.2%₹248 Cr
Oil Business (Q2 FY26)0%8.2%43.2%—
Cable Division (Q2 FY26)25.1%——₹157 Cr

Order book

high confidence

Total value

₹9,004 Cr

as of 2025-09-30 quantified

Composition

Mix 2 products
  • Conductor Division 79.6%
  • Cable Division 20.4%

Share of order book by product

Cancellations & deferrals

  • deferred: New ordering globally put on hold due to metal price volatility and US tariffs, leading to a significant reduction in order inflow and a near complete stop for US orders during August-September.
New orders received for the conductor division during H1 FY26 were Rs. 5,256 crores. While order inflow from the US market had almost completely stopped in August-September due to tariffs, new orders have started coming in Q3, albeit at lower margins, with revenue recognition expected in Q4 FY26. Overall, order inflow has not been cancelled but is on hold in many instances due to metal price volatility.

Source: Prepared remarks

Capital allocation

high confidence
  • Capex ₹1,300 Cr
    • Capacity expansion across all three divisions, specifically for 2+ years of expanded capacity.
    • Cable capacity expansion (part of total capex) to increase revenue generating capacity from ₹5,000 crores to ₹10,000 crores. ₹800 Cr
    For FY'26, we have about Rs. 1,300 crores as a ballpark Capex across all three divisions. ... This Rs. 800 crores increase in Capex will result in an immediate increase that happens of around Rs. 6,000 odd crores. So, from Rs. 5,000 crores which we started with, we will be able to end up at about Rs. 10,000 crores. ... we are putting in Capex, which is good for over two years of expanded capacity, and we are doing this in advance.

Guidance & targets

Profitability

  • Conductor EBITDA per Metric Ton Profitability · medium to long-term 12-month period · High confidence ₹30,000
    Basically, on the EBITDA part, we will continue our guidance of 30,000 per metric ton as we have been explaining in the calls earlier, it's a combination of various product categories.

    — Ramesh Iyer

  • Cable Business EBITDA Margin Profitability · medium to long-term · High confidence 10-12%
    So, on a medium to long-term basis, we expect the margins to hover around 10% to 12% as we have been guiding earlier.

    — Ramesh Iyer

Revenue

  • Cable Business Revenue Growth Revenue · year on year · High confidence 25%
    But all I can tell you is that we have been guiding a growth of 25% year on year.

    — Kushal Desai

Capex

  • FY26 Capex Capex · FY26 · High confidence ₹1,300 crores
    For FY'26, we have about Rs. 1,300 crores as a ballpark Capex across all three divisions.

    — Ramesh Iyer

Capacity

  • Cable Revenue Generating Capacity Capacity · post ₹800 crore capex · High confidence ₹10,000 crores

    Previously ₹5,000 crores → ₹10,000 crores

    This Rs. 800 crores increase in Capex will result in an immediate increase that happens of around Rs. 6,000 odd crores. So, from Rs. 5,000 crores which we started with, we will be able to end up at about Rs. 10,000 crores.

    — Kushal Desai

What to watch in Q3 FY26

US Export Order Inflow and Revenue Recognition

Q4 FY26
Current Substantially lower billing in Q3 FY26 due to tariff impact, new orders started coming in Q3 at lower margins.
Target Pick-up in order inflow and revenue recognition in Q4 FY26.

Why it matters

Recovery from US tariff impact is crucial for overall performance, as the US market is a significant growth driver.

So, this would definitely have a short-term impact in our booking of revenues in Q3 of FY'26. Because the new order inflow which has started coming in, even though it is at lower margins, it is all on a DDP basis, so the revenue will get recognized in Q4 of FY’26.

Risks & concerns

  • US Tariffs (Section 232)

    high

    Imposition of 50% duty on metal content of products led to a temporary halt in order inflow from the US market during August-September, impacting Q3 revenue booking.

    Management acknowledged

  • Metal Price Volatility

    medium

    Sudden spike in aluminum and copper prices causing customers to put new orders on hold, waiting for prices to correct downwards.

    Management acknowledged

  • Domestic Project Execution Delays

    medium

    Right-of-way issues and a shift to milestone-based billing for government projects are causing slower movement and delayed material ordering in Q3.

    Management acknowledged

Q&A highlights

8 direct
Conductor EBITDA per metric ton guidance Direct
Basically, on the EBITDA part, we will continue our guidance of 30,000 per metric ton as we have been explaining in the calls earlier, it's a combination of various product categories. And depending on what gets executed during the quarter, our margins comes up.

Clarifies that despite current higher realizations, the long-term guidance remains conservative due to product mix variability.

Asked by Umesh Raut

US demand drivers for electricity and transmission lines Direct
So data centers is definitely one of the major drivers of the electricity demand in the US. But in terms of the products that we are selling, especially the conductor part, so transmission is an important component to feed the power to the data centers. The second driver is also in terms of the various other projects, especially wind energy in the US.

Identifies specific high-growth end-user segments driving US demand for the company's products.

Asked by Umesh Raut

Impact of metal price volatility on new orders Direct
because metal prices have suddenly shot up, people have stopped ordering at the moment because their product will be more expensive. A lot of customers are in a wait and watch mode to see if the price is actually correct downward for the metals, in which case they would end up placing new orders. So, the order inflow has not been cancelled, but it's on hold in many instances.

Explains the immediate cause of reduced order inflow and clarifies that orders are deferred, not cancelled, indicating potential future recovery.

Asked by Amit Anwani

Impact of US Section 232 tariffs on sales and margins Direct
for almost two months, which is your August and September of the last quarter, the order inflow had almost completely stopped because people were waiting and watching to see what would happen between the tariff situation. However, as I mentioned in the opening remarks that in Q3, we have started seeing a flow of orders starting to come in. So, this would definitely have a short-term impact in our booking of revenues in Q3 of FY'26.

Details the immediate negative impact of tariffs on Q3 revenue booking and the subsequent, albeit slower, resumption of orders.

Asked by Amit Anwani

Domestic cable growth in Q2 FY26 Direct
Also, the domestic market, Q2 is normally the slowest period. The power cable work really stops quite dramatically in Q2. So, we took that period to actually complete all the US export orders which were there. We have not really had any major penalties and tariff-related issues to absorb in terms of our own P&L so far. Our expectation is that in Q3 and Q4, the domestic market will be picking up.

Provides context for the slower domestic growth in Q2 and outlines expectations for a rebound in subsequent quarters.

Asked by Amit Anwani

Timeline and capacity addition from ₹800 crore cable capex Direct
So, in the case of cables, the first phase of equipment are coming in the January-March quarter. And the balance will all arrive in the April-June quarter. So, by the June quarter, you will have pretty much everything having landed up at our sites. And then the commissioning will take place. So, bulk of the commissioning, I would imagine, would be done by June of 2026.

Gives a clear timeline for the commissioning of significant new cable manufacturing capacity.

Asked by Kunal Sheth

Reconductoring opportunity in India Direct
Number one is that it's significantly cheaper than putting up a new line. Secondly, it is much faster and it is in the hands of the utility to give you the outage to actually put the lines up. So, there is no right of way required or no third-party permissions which are required. And the third thing is that if you choose the right design, you can actually increase the throughput of power by 150% more or 200% more.

Highlights the strategic advantages and significant potential of reconductoring projects in India for grid modernization and capacity enhancement.

Asked by Achal Lohade

Primary cause of subdued ordering in Aug-Sep Direct
I would think that 232 was the single largest factor for it. Reciprocal tariffs of countries also did not get declared overnight in one shot. If you see, they were being announced country-by-country. So, the whole thing actually resulted in a couple of months where things needed a bit of settling time.

Clarifies that the sudden and broad impact of Section 232 tariffs was the main reason for the temporary halt in US order inflow, rather than just metal prices or reciprocal tariffs.

Asked by Amitoj

3 min read 7 chapters

Detailed narrative

Strong Q2 & H1 FY26 Consolidated Performance

Apar Industries reported a robust Q2 FY26, with consolidated revenue growing 23.1% YoY to ₹5,715 crores and PAT increasing 30% to ₹252 crores. The consolidated EBITDA post forex for the quarter stood at ₹499 crores, marking a 24% YoY increase with a margin of 8.7%. The first half of FY26 achieved a significant milestone, with consolidated revenue crossing ₹10,000 crores for the first time, reaching ₹10,820 crores, representing a 25% YoY increase. H1 EBITDA post forex was a historically high ₹1,000 crores, up 25.5% YoY, with a margin of 9.2%.

Conductor Division Driven by Premium Products and Exports

The conductor division delivered a strong performance in Q2 FY26, with revenue growth of 34.9% YoY and volume growth of 16.2%. This was significantly supported by a premium product mix, which contributed 45.4% of the division's revenue. Exports surged by 74.6% YoY, accounting for 24.2% of the overall revenue. The EBITDA post forex for the division grew 21.4% to ₹248 crores, with EBITDA per metric ton improving to ₹39,636, up from ₹37,702 in the prior year, reflecting the favorable product mix and strong US business.

Cable Division's Robust Growth and Expanding Export Mix

The cable division posted a strong revenue growth of 25.1% in Q2 FY26, reaching ₹1,535 crores. Exports were a key driver, with the export mix increasing to 42.3% from 29% in Q2 FY25, and US revenues growing 121.2% in H1. The division's EBITDA post forex recorded a 32% YoY growth to ₹157 crores, and the EBITDA margin expanded by 50 basis points to 10.2% compared to the previous year. The pending order book for the cable division stands at ₹1,836 crores.

US Market Headwinds and Recovery Outlook

The US market, particularly for renewable energy projects, remains a significant growth area, with H1 US revenues for conductors and cables already exceeding ₹1,600 crores. However, the imposition of Section 232 tariffs (50% duty on metal content) led to a near complete halt in order inflow from the US during August-September, impacting Q3 revenue booking. Management anticipates a recovery in order inflow and revenue recognition from Q4 FY26, driven by time-bound IRA incentives for renewable projects, despite new orders coming in at potentially lower margins.

Domestic Market Dynamics and Execution Challenges

The domestic market is expected to pick up in H2 FY26, traditionally a stronger period due to fewer weather-related issues. However, Q3 faces short-term challenges from right-of-way issues and a shift to milestone-based billing for government projects, which has temporarily slowed material offtake. Management expects a strong construction season from November to March, which should accelerate conductor and cable demand, particularly given the existing backlog in substation additions that will drive demand for transmission lines.

Strategic Capacity Expansion and Future Readiness

Apar Industries is proactively investing in capacity expansion, with a planned Capex of ₹1,300 crores for FY26 across all divisions, of which ₹400 crores has been spent in H1. The ₹800 crore cable capex is projected to increase revenue generating capacity by ₹6,000 crores, from ₹5,000 crores to ₹10,000 crores, with bulk commissioning expected by June 2026. This advance investment in fungible equipment and new factory facilities aims to support sustained growth for the next two years and beyond, ensuring readiness for increasing demand.

Reconductoring as a Key Growth Opportunity in India

Management highlighted reconductoring as a significant and strategic opportunity for India's power sector. This method is considerably cheaper and faster than building new lines, requires no new right-of-way, and can increase power throughput by 150-200% with optimal design. Given India's resource constraints and the growing energy demands from data centers, reconductoring is seen as the best way to upgrade the grid. The government is actively developing a reconductoring plan as part of its 500 GW renewable energy blueprint, which Apar is well-positioned to capitalize on.

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