Apollo Tyres to invest $340 million to upgrade facilities

Company's board also gave its nod to seek shareholders' approval to raise $200 million

Apollo Tyres board today said its board has approved a proposal to invest $340 million (around Rs 2,025 crore) to upgrade its manufacturing facilities at Chennai and Kalamassery (Kerala).

Besides, the company's board which met today, also gave its nod to seek shareholders' approval to raise $200 million (around Rs 1,191 crore) via issue of securities to pursue organic growth opportunities and for other corporate purposes, Apollo Tyres Ltd said in a statement.

The board approved expansion of the truck and bus radial tyre capacity at the company's Chennai plant from the present 6,000 tyres per day to 8,900 tyres per day.

"The board noted the improved demand outlook and the fact that the current Chennai project is generating returns ahead of projections," it added.

The board also approved conversion of the company's leased operations at Kalamassery plant from bias truck tyres to speciality, industrial tyres.

"The company estimates a capex of $340 million (Rs 2,050 crore) for these projects," the company said.

The company, however, did not share details about the timeframe for investing in the facilities as well as raising of capital through securities.

Besides, the board also approved a proposal to increase the limit of investments by FIIs from 40% to 45% in the equity share capital of the company.

Apollo Tyres shares today closed at Rs 204.25 apiece on the BSE, up 0.47% from their previous close.