Apollo Tyres vs CEAT Which Is a Smarter Choice?

Apollo Tyres and CEAT are two major players in the Indian tire manufacturing industry, both listed on the stock exchange. Apollo Tyres, a leading tire manufacturer with a strong presence in both domestic and international markets, has shown steady growth in recent years. On the other hand, CEAT, another established player in the industry, has also been performing well and gaining market share. Investors looking to invest in the tire manufacturing sector may consider these two stocks for potential growth and returns.

Apollo Tyres or CEAT?

When comparing Apollo Tyres and CEAT, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Apollo Tyres and CEAT.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Apollo Tyres has a dividend yield of 1.11%, while CEAT has a dividend yield of 0.94%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Apollo Tyres reports a 5-year dividend growth of -30.12% year and a payout ratio of 0.00%. On the other hand, CEAT reports a 5-year dividend growth of 0.85% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Apollo Tyres P/E ratio at 23.71 and CEAT's P/E ratio at 22.77. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Apollo Tyres P/B ratio is 2.40 while CEAT's P/B ratio is 3.07.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Apollo Tyres has seen a 5-year revenue growth of 0.30%, while CEAT's is 0.70%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Apollo Tyres's ROE at 10.53% and CEAT's ROE at 14.10%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are ₹536.65 for Apollo Tyres and ₹3149.05 for CEAT. Over the past year, Apollo Tyres's prices ranged from ₹419.25 to ₹584.90, with a yearly change of 39.51%. CEAT's prices fluctuated between ₹2210.15 and ₹3578.80, with a yearly change of 61.93%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.