Apollo sees sales up by 55% in Q1

ERJ staff report (DS)

Gurgaon, India -- Apollo Tyres reported a 55 percent increase in sales in the three months to 30 June 2011. The company issued its unaudited results earlier today showing Q1 sales of Rs 28 200 million (euro 437.6 million) compared with Rs 18 200 million in the same period a year ago.

Operating profit grew by 20 percent to Rs 2400 million, from Rs 2000 million. Net profit was up by 3.9 percent at Rs 771 million, from Rs 742 million

The company said Indian consumers are strongly rsisting efforts by tyre makers to raise prices in the face of higher raw material costs.

Speaking on the results, Onkar S Kanwar, Chairman, Apollo Tyres Ltd, said: “This will be yet another

difficult year for us. In our largest market in India, inability to raise prices in time is having an adverse

impact on all Indian tyre manufacturers. Some of the players have already posted negative results and

this will influence overall investments in the sector.

In his speech to shareholders at the company's annual general meeting, Kanwar said, "The Chennai plant, which will reach its planned capacity towards the end of this year, will bring to your Company the scale it now requires. Similar expansions have taken place in your manufacturing units in both Europe and Africa. You would also have heard from me on the many new markets that we have been entering into in the last few months. Much like our earlier 5 year strategic planning exercise, during the course of the next half decade, we hope to once again bring to you greater value by embracing the mantra of the times."

He added, "We have also actively entered the area of rubber plantations to try and secure future supplies. And we are working on multiple fronts to holistically address the issues of climate change, renewable energy and conservation. "

Kanwar continued, "The June quarter, for the first time, saw India's growth rate in passenger sales outstrip that of China. More and more global automotive manufacturers are either setting up shop in India, or are expanding capacities. As China starts to slow down, India will take its pre-eminent position; not just in the automobile industry but across various sectors. This is a time of great promise for our country and all of us must work together, diligently and sincerely, to encash on that promise. "

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Press release (Q1 results) from Apollo

Press release (Chairman's speech) from Apollo