APL Apollo Tubes - above the cloud, momentum cooling off

APL Apollo Tubes (APLAPOLLO) trades at Rs 2,143 and remains comfortably above the Ichimoku cloud, which sits between Rs 1,821 and Rs 1,840. That is a wide margin, and it reflects a strong run of about 21% over the last 60 sessions and 10% in the last month alone. The 20 EMA at Rs 2,119 and the 50 EMA at Rs 2,012 are both below price and have been separating since crossing on 4 August. The detail that stands out is the momentum reading. RSI has fallen from about 80 five sessions ago to 58 now, while price has come off only around 6% from the 60 day high of Rs 2,278. A steep drop in RSI without a matching drop in price is best read as a reset rather than a reversal. The overbought condition is being worked off through time and sideways movement instead of through a decline, and the trend structure has not been damaged. Volume on the last completed session ran about 1.25 times its 20 day average, so participation remains healthy. The Tenkan at Rs 2,199 is the immediate hurdle, and the Kijun at Rs 2,042 is the first real support. As long as price holds above the Kijun, the uptrend stays in place. On the business, Q1 FY27 net profit came in at about Rs 263 Cr with EBITDA up roughly 11% YoY, as better margins offset a dip in volumes. Management has guided to around 20% EBITDA growth for FY27 with a volume rebound expected in Q2. Structural steel tubes is a volume business where profit per tonne matters more than the steel price itself, so the margin line is the one to follow. Rs 2,042 is the level to watch.