Rs 176 to Rs 1,343: This steel stock turned into a multibagger in three years, set to reclaim 52-week high

Shares of APL Apollo Tubes Ltd have turned multibagger, delivering over  660% returns in the last three years. The iron and steel stock, which closed at Rs 176.07 on July 6, 2020, hit an intraday high of Rs 1343.50 on BSE today, translating into a gain of 663 per cent during the period.The stock closed at Rs 1329 in the previous session. In the current session, the stock gained 1.09% to Rs 1343.50 on BSE. APL Apollo Tubes stock has gained 21% this year and risen 49.72% in a year.

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The stock hit a 52-week high of Rs 1398.55 on June 22, 2023 and a 52-week low of Rs 850.15 on July 14, 2022.  A total of 9852 shares of the firm changed hands, amounting to a turnover of Rs 1.31 crore on  BSE. The market cap of the company stood at Rs 36,539 crore on BSE.  

In terms of technicals, the relative strength index (RSI) of APL Apollo Tubes stands at 58.2, signaling it's trading neither in oversold nor in the overbought zone. APL Apollo Tubes stock has a one-year beta of 0.5, indicating very low volatility during the period. The stock is trading higher than the 5 day, 20 day, 50 day, 100 day and 200 day moving averages but lower than the 10 day moving averages. 

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Antique Stock Broking has maintained its buy call on the stock and revised its target price to Rs 1,629.The brokerage cited market share gains and good quarterly sales among the reasons behind the revision of target price .

“The company has consistently posted quarterly sales volume in excess of 600 KT over the last four quarters. The current narrowing of primary pipe price premium to secondary pipes would enhance price competitiveness and aid volume growth. Market share gains would support volume growth in line with management’s guidance of FY24 volume at 2.8–3 MT (27% higher YoY)," the brokerage said.

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"Product mix improvement and Raipur plant’s higher EBITDA per tonne of Rs 6,000–9,000 would support profitability with blended EBITDA per tonne at Rs 5,000–5,500 level. We incorporate a steady volume growth outlook, a greater proportion of value-added products and revise our target price to Rs 1,629 per share at a target P/E multiple of 35xFY25E EPS and maintain BUY rating on the stock,” the brokerage added.  

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APL Apollo Tubes Limited is the largest producer of structural steel tubes in India. It has an extended distribution network of warehouses and branch offices in 29 cities across the country catering to domestic as well as 20 countries worldwide. The Delhi-based firm offers over 1,100 varieties of Pre- Galvanized Tubes, Structural Steel Tubes, Galvanized Tubes, MS Black Pipes and Hollow Sections, making APL Apollo is one of leading branded steel products manufacturers in India.