IIFL Securities Stock Idea: Buy Apollo Tyres with Target Rs 553

IIFL Securities has issued a buy call for Apollo Tyres with a target price of Rs 553, marking an upside potential of over 3% from its current market price of Rs 537. The recommendation is based on the company's strong performance in the domestic market, its expanding presence in global markets, and its ongoing cost-optimization initiatives. IIFL believes that Apollo Tyres is well-positioned to capitalize on the growing demand for tires both in India and abroad, making it an attractive investment opportunity.

About Apollo Tyres:

Apollo Tyres is an Indian multinational tyre manufacturing company headquartered in Gurugram, Haryana. It was established in 1972 and is the 7th largest tyre manufacturer in the world. The company's products include tyres for passenger cars, trucks, buses, agricultural vehicles, and mining and construction equipment. Apollo Tyres has operations in over 100 countries and employs over 15,000 people. The company is known for its focus on innovation and technology, and it has been awarded numerous patents for its tyre designs and manufacturing processes.

52 Week Price Trend:

Apollo Tyres' CMP of Rs 537 is close to its 52-week high of Rs 559.85. The stock has had a remarkable run-up lately, reflecting investors' confidence in the company's performance and growth prospects. However, it's important to note that the stock price has also experienced significant fluctuations, with a 52-week low of Rs 303.35. This highlights the inherent volatility of the stock market and underscores the need for investors to carefully consider their risk tolerance and investment strategy.

Stratzy's MOST Analysis:

Based on Stratzy's MOST framework, APOLLOTYRE has received a BBB rating. This indicates that the company has medium fundamental risks, as determined by an assessment of its Management, Outlook, Safety, and Trend. This rating suggests that investors should exercise caution when considering APOLLOTYRE, as there may be potential weaknesses or uncertainties in one or more of these areas that could impact its future performance.

Company's Fundamentals:

Apollo Tyres (APOLLOTYRE on NSE) is a leading tyre manufacturer with a strong presence in India and a growing global footprint. Its financial ratios provide valuable insights into the company's valuation and performance. Stock PE of 18.52 indicates that investors are willing to pay 18.52 times the company's earnings for each share. PB Ratio of 2.57 suggests that Apollo Tyres' market value is 2.57 times its book value, indicating a premium valuation. The Dividend Yield of 0.76% represents the annual dividend paid per share as a percentage of the current stock price, indicating a modest dividend income stream for investors. These ratios collectively provide a snapshot of Apollo Tyres' financial health and valuation, helping investors make informed investment decisions.

Fundamental and Technical information provided in this blog were last updated on 09 Jul, 2024

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