Despite a good Q3, near-term demand worries cloud Apollo Tyres' outlook

There could, however, be some margin relief on account of falling input costs

Led by a strong operating performance, Apollo Tyres posted better-than-expected financials for the October-December quarter (Q3). Higher gross margins led to a sharp jump in operating profit and the softening raw material basket is a positive for profitability going ahead. Despite the improved show, the stock corrected 3 per cent in trade on Tuesday, which can be attributed to the subdued outlook for domestic and international replacement segments.

Though volumes in the December quarter for the standalone (India) business fell by 4 per cent, revenue growth came in at 12 per cent. This was driven by price hikes and product