Current Rating and Its Significance
MarketsMOJO’s 'Strong Buy' rating for APL Apollo Tubes Ltd indicates a robust confidence in the stock’s potential for superior returns relative to the broader market. This rating is based on a comprehensive evaluation of four key parameters: Quality, Valuation, Financial Trend, and Technicals. Investors should understand that this recommendation reflects the company’s present fundamentals and market conditions as of the end of January 2026, rather than solely the circumstances at the time of the rating update in October 2025.
Quality Assessment
As of 31 January 2026, APL Apollo Tubes Ltd exhibits an excellent quality grade. The company demonstrates strong operational efficiency and profitability, highlighted by an average Return on Capital Employed (ROCE) of 27.96%. This figure underscores the firm’s ability to generate substantial returns on its invested capital over the long term. Additionally, the company’s net sales have grown at an impressive annual rate of 22.70%, while operating profit has expanded by 24.59% annually, signalling healthy and sustainable business growth.
Valuation Perspective
The valuation grade for APL Apollo Tubes Ltd is currently assessed as fair. The stock trades at a Price to Book Value of 12.3, which, while elevated, is reasonable when compared to its peers and historical averages. Importantly, the company’s Price/Earnings to Growth (PEG) ratio stands at a modest 0.6, indicating that the stock’s price growth is not excessively stretched relative to its earnings growth. This suggests that investors are receiving good value for the growth prospects embedded in the share price.
Financial Trend and Profitability
The financial trend for APL Apollo Tubes Ltd is very positive. The latest quarterly results, as of December 2025, show a net profit growth of 42.9%, with the company reporting its highest quarterly net sales of ₹5,815.13 crores and a peak PBDIT of ₹471.79 crores. The company has consistently declared positive results for four consecutive quarters, reflecting strong momentum. Furthermore, the low Debt to EBITDA ratio of 0.35 times indicates a conservative capital structure and a strong ability to service debt obligations, which is reassuring for investors seeking stability alongside growth.
Technical Analysis
From a technical standpoint, the stock is currently rated bullish. Price momentum indicators support the positive outlook, with the stock delivering a 38.73% return over the past year and a 30.43% gain over the last six months as of 31 January 2026. The recent one-month and three-month returns of 8.46% and 14.51% respectively further confirm the stock’s upward trajectory. Despite a minor one-day decline of 0.51%, the overall trend remains strongly positive, signalling continued investor interest and confidence.
Additional Considerations for Investors
APL Apollo Tubes Ltd benefits from high institutional ownership, currently at 53.03%. This level of institutional holding often reflects thorough analysis and confidence from sophisticated investors, which can provide a stabilising influence on the stock price. Moreover, the company ranks among the top 1% of all stocks rated by MarketsMOJO, placing it second among mid-cap stocks and second across the entire market. This elite positioning highlights its exceptional standing in terms of fundamentals and market performance.
Here's How the Stock Looks TODAY
As of 31 January 2026, the company’s financial metrics and market performance reinforce the rationale behind the 'Strong Buy' rating. The combination of excellent quality, fair valuation, very positive financial trends, and bullish technicals creates a compelling investment case. Investors looking for exposure to the iron and steel products sector may find APL Apollo Tubes Ltd an attractive option given its consistent growth, strong profitability, and favourable market positioning.
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- - Top-rated across platform
- - Strong price momentum
- - Near-term growth potential
Performance Snapshot
The stock’s recent performance metrics as of 31 January 2026 further illustrate its strength. Over the past year, APL Apollo Tubes Ltd has delivered a total return of 38.73%, significantly outperforming many peers in the iron and steel products sector. Year-to-date returns stand at 6.69%, with a six-month gain of 30.43%. These figures reflect sustained investor confidence and robust operational execution.
Long-Term Growth and Profitability
The company’s long-term growth trajectory is supported by a consistent increase in net sales and operating profits. With net sales growing at an annualised rate of 22.70% and operating profit expanding by 24.59%, APL Apollo Tubes Ltd has demonstrated its ability to scale operations efficiently. The Return on Equity (ROE) of 22.8% further confirms the company’s effectiveness in generating shareholder value.
Risk and Market Position
While the valuation is fair, investors should remain mindful of sector-specific risks such as raw material price volatility and cyclical demand fluctuations in the steel industry. Nonetheless, the company’s strong balance sheet, low leverage, and consistent earnings growth mitigate many of these concerns. Its market capitalisation as a midcap stock offers a blend of growth potential and relative stability compared to smaller peers.
Conclusion
In summary, APL Apollo Tubes Ltd’s 'Strong Buy' rating by MarketsMOJO reflects a well-rounded investment proposition. The company’s excellent quality metrics, reasonable valuation, very positive financial trends, and bullish technical indicators combine to present a compelling case for investors seeking growth in the iron and steel products sector. The current data as of 31 January 2026 confirms that the stock remains well-positioned to deliver attractive returns over the medium to long term.
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