Apar Industries Q2 FY27 Earnings Call: Conductor Book Hits Record Rs. 12,025 Cr, Rs. 1,000 Cr Data Center Cable Wins (APARINDS)

Apar Industries Ltd held its Q2 FY27 earnings call on October 29, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Record H1 with Strong Margin Expansion, Masked US Transit Distortion

• Q2 FY 2026-2027 revenue of Rs.6,931 crore — up 21.3% YoY and 5.2% QoQ; EBITDA (post open-period forex) rose 57.8% YoY to Rs.787 crore with margin up 270 bps to 11.4% (vs 8.7% in Q2 FY 2025-2026); PAT rose 77.8% YoY to Rs.447 crore (PAT margin 6.5%, +200 bps).
• H1 FY 2026-2027 was the highest-ever half-yearly revenue and profit — revenue +25% to Rs.13,522 crore (domestic +35.5%; exports +3.7% ex-transit, 27.6% of revenue; US down 21.5%); EBITDA +60.2% to Rs.1,602 crore (margin 11.8% vs 9.2%); PAT +77.7% to Rs.915 crore.
• ~Rs.800 crore of conductor/cable sales in DDP transit — all destined for US customers due to shipping/container delays, pushing recognized US revenue down 29.7% YoY in Q2 FY 2026-2027; management expects the picture to improve in Q3 FY 2026-2027 as this revenue realizes.
• US tariff refunds of ~430 million recognized in Q2 FY 2026-2027 — a one-off; management has "closed the book," most refunds were received prior to 30 September 2026, the bulk was passed on to clients per contractual obligations, and nothing recurring is expected from this.
• QIP of Rs.2,500 crore completed in Q2 FY 2026-2027 — raised for working capital and balance-sheet strengthening; credit rating upgraded one notch from AA- to AA, enabling larger finance limits and lower borrowing costs.

All-Time-High Conductor Book; ~Rs.1,000 Cr of Data Center Cable Orders

• Conductor order book at an all-time high of Rs.12,025 crore as of 30 September 2026 (Q2 FY 2026-2027); Q2 inflows of Rs.4,725 crore (+82% YoY), including ~Rs.3,000 crore from UK/US utilities; ~25% of the book staggered over 2-3 months, remainder executable in under 18 months from Q2 FY 2026-2027 close.
• Data centers ~Rs.1,000 crore of the ~Rs.3,000 crore cable order book — the two large awards are a contractor order flowing into a Google data center in the Midwest US (the largest single order from the US at over Rs.500 crore) and the largest Amazon award; a couple hundred crore more sits in the book from smaller data centers, with a big pipeline of discussions ongoing.
• Execution timelines — the Google order is to be fully executed by around Diwali (Q3 FY 2026-2027); Amazon orders are being issued piece by piece depending on ground infrastructure availability, with management expecting all of these to be completed by March (Q4 FY 2026-2027).
• US AI data center packages typically range Rs.400-1,000 crore each — management expects growing participation in such RFQs as delivery credibility is established; US data center cables carry a better margin profile than Indian equivalents due to higher specs, while India offers a larger addressable market but higher competitive intensity and lower margins.
• First Z-type conductor order from a large Scandinavian utility — for evacuating power from an offshore windmill; only two other manufacturers worldwide produce it; management expects such products to find their way to India over time, citing cyclone exposure on India's east coast.
• Other notable wins in Q2 FY 2026-2027 — a Rs.960 crore 48-fiber OPGW order from Karnataka Power and Transmission Corporation Limited (KPPCL) using IPMPLS technology on a complete turnkey basis (incorporating technology from Apar's tie-up with Nokia), and a first-ever 144-fiber OPGW order from a Central America customer.
• Cable order book at ~Rs.3,000 crore+ vs a historical Rs.1,600-1,900 crore range — with the bulk expected to be executed before end of FY 2026-2027 and more orders expected from the same Amazon site.

Value Over Volume: Oil Margins Surge, Conductor Volumes Dip

• Conductors Q2 FY 2026-2027: revenue +21.1% to Rs.3,753 crore — but volume -9.2% YoY; EBITDA +11.3% to Rs.276 crore; EBITDA/MT Rs.48,241 vs Rs.39,363; premium mix 39.4% vs 45.3% in Q2 FY 2025-2026. H1 FY 2026-2027: revenue +20.5% to Rs.7,092 crore, volume -8%, EBITDA/MT Rs.50,739 vs Rs.41,421.
• Volume degrowth attributed to delayed manufacturing clearances and TBCB order awards — amid commodity inflation (LME copper/aluminum, MJP aluminum premium at a 4-year high, sharp steel price rise); TBCB orders carry execution windows not exceeding 36 months with stringent delay penalties.
• Oil Q2 FY 2026-2027: revenue +35.6% YoY to Rs.1,819 crore — volumes deliberately capped at 128,590 KL (-20% YoY) as record refining margin spreads nearly doubled per-unit billing value against customer exposure limits; EBITDA +185% to Rs.299 crore; EBITDA/KL Rs.23,262 vs Rs.6,517; export mix 37% vs 43%. CFO Ramesh Iyer cautioned Q2 oil margins are "by no means normal" — they include some gains.
• Cables Q2 FY 2026-2027: revenue +22.1% to Rs.1,875 crore — copper 30% of mix vs 20% (copper prices +~50%, aluminum +~35%); US sales -50% YoY with over Rs.440 crore in DDP transit; domestic +71.4% YoY; EBITDA margin +80 bps to 11% despite headwinds from freight, metal premiums, and a sudden rise in steel prices.
• Capacity utilization — cables at 90%+ overall with copper-based sections serving data center orders at 100-105% (flat out); conductors at ~80%; oil division capacity not a constraint.
• Silvassa rains disrupted CTC output in Q2 FY 2026-2027 — heavy rains badly damaged one half of the CTC complex, idling capacity equivalent to roughly 20 of 90 days and constraining CTC shipments; some transformer customers' capacity expansions have also been delayed.

New Entrants Not a Major Concern; Premium Mix Cushioned the Volume Drop

• New conductor entrants not a major concern, per MD Chaitanya Desai — a few players with their own EPC/downstream operations have backward-integrated, carving out a portion of the domestic market that is "not that accessible" to Apar; in HTLS, meeting quality specs, engineering design, product performance, and end-to-end project completion remain challenges for newcomers.
• Management does not expect a reduction in its volumes — the overall market pie is growing; Apar intends to maintain volume leadership and profits through innovative products and is "not really worried about competition."
• Premium mix compensated the Q2 FY 2026-2027 volume drop — both premium and non-premium conductor volumes declined in H1 FY 2026-2027, but residual volumes split across multiple premium categories kept EBITDA above Q2 FY 2025-2026.
• AL59 kept in the conventional bucket — CFO Ramesh Iyer said the company consistently discloses only premium vs non-premium; the AL59 premium is no longer that large, though management believes the AL59 story will remain, being significantly better than ACSR-type products.
• Chinese competition "very aggressive" in standard products — a significant arbitrage between the Shanghai Metal Exchange and LME gives Chinese exporters a fundamental benefit; Apar is concentrating on US, Europe and Latin America customers, and holds Rs.3,000 crore of rate contracts from utilities in the US and Europe spread over 2-3 years.
• Volatility risks flagged — NJP at a four-year high and freight on certain lanes (LATAM and Europe) up 2-3x in the short term; strategy is to remain selective on business quality, since low-margin work can be completely wiped out by such impacts beyond the company's control.

Rs.1,500 Cr Capex Program Underway; Regulatory Changes Favor Reconductoring

• ~Rs.500 crore of capex spent in H1 FY 2026-2027 — against the Rs.1,500 crore domestic capex program planned over 12-15 months from the start of FY 2026-2027; management did not confirm the analyst's suggested FY27/FY28 split, and once this phase completes, annual capex is expected at Rs.300-400 crore (FY 2027-2028 onward), excluding any overseas capex.
• Enabling resolution to invest up to $100 million in Singapore subsidiary PSPL — up from the earlier ~$10 million proposal; MD Chaitanya Desai declined to disclose the purpose or funding mode, stating details will be revealed only after intimation to the stock exchange; overseas expansion is "at a fairly advanced stage" but not yet closed.
• Trade payable days fell from ~109 days (March 2026) to ~81 days at Q2 FY 2026-2027 — as QIP proceeds were deployed into working capital via cash purchases of raw materials; customer acceptances stood at ~Rs.3,500 crore as of September 2026.
• India added ~8,775 circuit km of transmission lines in H1 FY 2026-2027 (+153% YoY) — and 6,71,815 MVA of transformation capacity (+52% YoY); execution/delivery of transmission lines under older contracts hit an all-time high in Q2 FY 2026-2027, up 153% vs Q2 FY 2025-2026.
• In September 2026, the Centre approved intra-state transmission systems to evacuate up to 135 GW of renewable energy by FY33 — management cited ~51,126 circuit km of lines and 2,28,903 MVA of transformation capacity, with expected investment of ~Rs.1.86 trillion (the third green transmission corridor).
• CEA has set a 10-15% thermal margin limit and mandated N-1 network reliability — management expects these changes to accelerate reconductoring, especially where electricity demand is growing; management cited two CEA changes made within Q2 FY 2026-2027 as having "very far-reaching consequences" for where HTLS will be applied, though these will take time to percolate down.
• US Department of Energy's SPARC program (announced September 2026) lists 31 projects in 26 states with ~$1.9 billion of federal funding — expected to unlock 23 GW of transmission capacity via ~1,500 miles of reconductoring/rebuilding and ~21,000 miles of grid-enhancing technologies (period unspecified); third-party program context, not a company commitment.

H2 Volume Recovery Expected; FY27-FY28 "Quite Bullish"

• Management expects H2 FY 2026-2027 conductor volumes to be stronger than H1 — Chairman Kushal Desai said business trends remain strong despite some volume degrowth; CFO Ramesh Iyer expects the volume decline to be arrested by Q3 FY 2026-2027, with Q3 and Q4 stronger than Q1 and Q2 as peak project-completion seasons arrive and customers face finite timelines.
• Rest of FY27 and FY28 described as "quite bullish" — citing strong order books; management is confident of FY 2026-2027 performance, with the data center capex cycle building both overseas and in India.
• Cable value growth guided at 25% for FY 2026-2027 — which management is confident of meeting or exceeding; cable EBITDA margin targeted to settle between 10-12% alongside 25% YoY growth, conditional on stable metal prices (period unspecified); management's publicly stated aspiration is to reach 11-12% (period unspecified).
• Conductor EBITDA/ton guidance framework — CFO Ramesh Iyer reiterated the standing guidance of Rs.35,000-36,000/ton plus tailwinds, which vary with product mix, execution and sale geography; this is a medium-to-long-term framework rather than an FY 2026-2027-specific commitment, as order books are largely MTO-based.
• Higher-voltage power cables an FY28 play — Apar currently executes power cables up to 66 kV; incoming equipment will enable 132 kV and eventually up to 220 kV, but management does not expect any higher-voltage cable business in FY27.
• Medium-term industry growth outlook (period unspecified) — conductor industry expected to grow ~10% excluding metal-price aberrations (CFO Ramesh Iyer); cables ~15% at constant metal prices and 15-20% overall in rupee terms; transformer oil 5-7%, other oil products 2-3%, with Apar guiding 5-7% overall; lubricants have grown above the 7% FY 2026-2027 target.
• Oil volumes could remain subdued if base oil prices stay elevated — management is deliberately prioritizing margin, ROCE and quality of business over volume and is "not looking at a volume game at all" given persistent volatility; sharp freight-rate increases to Europe/LATAM are already showing signs of reversal into Q3 FY 2026-2027, improving export feasibility.