Tyre major Apollo Tyres will be signing a memorandum of understanding (MoU) with the Andhra Pradesh government on Thursday to set up a greenfield manufacturing facility in that state for two-wheelers.
The company, which recently entered the two-wheeler tyre market, will sign the the MoU with AP chief minister N Chandrababu Naidu on Thursday at New Delhi, said Neeraj Kanwar, vice-chairman and managing director, Apollo Tyres.
Kanwar, along with the chairman and senior board members, was in Chennai on Wednesday to inaugurate the company’s R&D centre and to declare its Q2 results. Apollo Tyres has invested R90 crore into this new R&D facility, which would serve both domestic and international markets/clients with advanced technologies and capabilities.
Addressing mediapersons in Chennai, Kanwar said, “Currently, we sell 200,000 two-wheeler tyres, which would be increased to 250,000 tyres by the end of this fiscal. Having seen a huge potential, both in terms of aftermarket and OEMs, the company has decided to set up the two-wheeler plant in Andhra Pradesh.” He refused to divulge further details on the two-wheeler plant.
According to Kanwar, the $475-million Hungary greenfield facility will become operational by early 2017, which would serve the whole of Europe. The existing plant at the Netherlands is running in full capacity and makes seven million tyres.
The tyre major has reported a marginal drop in its net profit for the quarter ended September to R205 crore, compared with 215 crore in the same quarter last financial year. The revenue too fell sharply to R2,303 crore during the period, against R2,521 crore in the year-ago period, due to sharp drop in sales in the commercial vehicles segment.