Apollo sales up 18 percent in 2005/06

Gurgaon, Haryana, India - Apollo Tyres Ltd. said it recorded sales of fractionally over Rs 30 021 million (€526 million) in the 12 months to 31 March, 2006, compared with Rs 26 568 million a year earlier.

The company also maintained a 3 percent profit margin, despite substantial increases in raw material costs. Between FY2004-05 and FY2005-06 prices of natural rubber went up by 28 percent and of crude by 35%., said Apollo. These two items account for over 65% of all raw material costs said the company.

Commenting on the results, Onkar Kanwar, chairman & managing director, Apollo Tyres Ltd, said: It is the third consecutive year of high raw material costs, with a sharp increase of over 15% compared to the previous year. However, our product price increases have not been in line with this. To balance the cost-push on this front, we have taken steps within the company to increase efficiencies across functions. We will have to continue to do this, since the challenge of high raw material prices will be with the industry for this year also.”

Kanwar further added that the company has set steep targets for the coming years which would allow Apollo Tyres to attain global scales of operation, while continuing to play a leading role in the Indian tyre industry.

Kanwar said the company has passed a number of milestones this year, most importantly the acquisition of an overseas tyre maker - Dunlop Tyres International with tyre factories in South Africa and Zimbabwe. This has made Apollo the forst Indian tyre maker to gain an international manufacturing base.

Apollo said overall production grew 12 percent and ioncluded gains in market share in many segments. Apollo has also entered the allow wheel business through the brand, Acelere Wheelz.