Apollo Races Ahead On Auto Recovery Talk

The Apollo Tyres share spurted 10.71 per cent today on the Bombay Stock Exchange (BSE), following talks of a recovery in commercial vehicles sales.

It closed at Rs 69.80, retracing from an intra-day high of Rs 71.45. "The rise is mainly on buying interest by operators who smell a revival for tyre makers due to the recovery in the commercial vehicles segment," an analyst said.

Talks of the problems at the Modi Rubber plant have also rekindled interest in the Apollo stock as sales of the company's tyres have increased in the replacement as well as retail market.

Prices rising by 2-3 per cent in the bus/truck tyre segment has also boosted the stock. In the last eleven trading sessions, the stock lost 26.7 per cent to Rs 63.05 on December 27, 2001, from Rs 86 on December 10, 2001. Volumes also declined to 4,250 from 36,590 shares traded in the same period.

Meanwhile, Apollo Tyres has announced plans to set up a greenfield truck radial plant to take advantage of a possible growth in demand. Earlier, it also became the first company in the country to launch farm radial tyres. The farm radials incorporate high-tech design elements to give optimum combination of durability, better fuel consumption and longer life. The new range of farm radials is being manufactured in technological collaboration with Continental AG of Germany.

The flagship of the Raunaq Singh group, Apollo Tyres, is engaged in the manufacture of automobile tyres and tubes at Perambra in Kerala, Vadodara in Gujarat and Pune in Maharashtra. Mahindra and Mahindra and TAFC are its major OEM clients.

The company has signed a memorandum of understanding with United Tyres, a Canada-based giant, for a 50 per cent buy-back of its products. It also has a joint venture agreement with Continental for its passenger car radial tyre factory at Pune.

The company was incorporated in 1972 and commenced production in 1977. It was the first to receive the ISO 9001 accreditation in the Indian tyre industry for its entire range of brands. Apollo Tyres took over Premier Tyres in April 1995 after which the latter's sick Stallion Tyres came under the Apollo brand name.