Apollo Tyres net up 2.9%

NEW DELHI, June 10: Apollo Tyres Ltd, the second largest tyre company in the country, has recorded a marginal increase of 2.9 per cent in n...

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NEW DELHI, June 10: Apollo Tyres Ltd, the second largest tyre company in the country, has recorded a marginal increase of 2.9 per cent in net profit to Rs 36.32 crore on a 14 per cent higher turnover of Rs 1,426.91 crore.Apollo’s board of directors decided to maintain the dividend at 40 per cent at a meeting here on Tuesday.

The company attributed the squeeze on profit margins to higher rubber price, increased inputs costs coupled with sluggish market condition. Apollo’s net profit in 1995-96 was Rs 35.31 on a turnover of Rs 1,250.91 crore.

The company’s operating profit before tax and finance charges has gone up by 18.5 per cent to Rs 134.88 crore during the last financial year. In the previous fiscal it was Rs 113.80 crore.

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The earning per share (EPS) works out to Rs 12.16 per share as on March 1997 on an equity capital of Rs 29.88 crore.

Company sources said that the highlight of Apollo’s performance in 1996-97 was a 100 per cent jump in sales in light commercial vehicle tyre segment. Apollo Tyres is already a market leader in the bus and truck tyre segment.

Sources added that given sluggish market conditions, enhanced input costs including the price of natural rubber and increasing competition, Apollo is taking a re-look at its work processes with a view to augment overall efficiency.

Apollo’s vice chairman and managing director Onkar Singh Kanwar said: "We will be a lean and fighting fit organisation that responds rapidly to market changes." The company is also in the process of restructuring its management in view of the resignation of its president Paras Chowdhury.