Apollo Tyres Q2 net dips 59% to Rs 53 cr

Apollo Tyres today announced a 58.79 per cent decline in its net profit to Rs 53.25 crore in the second quarter ended September 30, due to high input costs, especially that of rubber prices hurting margins.

The company had a net profit of Rs 129.24 crore the same period last year.

"Of particular concern to the Board is the spiralling prices of natural rubber to current all-time highs, which have sharply impacted the Indian operations," Apollo Tyres said in a statement.
   
During the period under review, the company's net sales witnessed a decline of 4.75 per cent to Rs 1,948.92 crore from Rs 2,046.19 crore posted in the year-ago period.

 

"It's been a very difficult six months managing the unprecedented rise in natural rubber prices. Even when international natural rubber prices were significantly lower than Indian prices, we were unable to import in large quantities due to the duty policy of the government," Apollo Tyres Chairman Onkar S Kanwar said.

The company had hiked prices due to the high natural rubber prices. "We have had no option but to pass on price increases to our customers, though it is impossible to pass on a near 50 per cent increase in the course of one year," he said, adding the natural rubber constitutes 60 per cent of the raw material costs.

The company's scrips were trading at Rs 70.60 per share towards the end of the day, down 6.18 per cent from the previous close on the Bombay Stock Exchange.