After a weak performance in FY25, which was largely impacted by a sharp rise in input costs, Motilal Oswal expects Apollo Tyres’ margins to gradually revive, aided by softening costs and its focus on premiumization. We have factored in a 130bp expansion in Apollo Tyres’ margins over our forecast period, driving a 25% PAT CAGR over a corrected base. Valuations at 15.6x FY27E appear attractive, especially when compared to peers.
