Tyre major Apollo Tyres has declared a consolidated net profit of Rs 291 crore for the first quarter of the current fiscal despite cheaper Chinese tyres putting pressure on the domestic market. However, revenue fell 12% y-o-y to Rs 2,832 crore in the period from Rs 3,223 crore in Q1 of FY15. Standalone net profit from Indian operations stands at Rs 227.1 crore.
The company board which met on Tuesday approved the capacity expansion of the Chennai plant to 12,000 tyres a day from the current 8,900 tyres at a cost of Rs 1,200 crore.The company informed the exchange that it has also approved raising Rs 2,000 crore in debt towards the expansion of the Chennai and Kalamassery plants.
Apollo will also seek shareholders’ nod for raising Rs 1,000 crore via private placement. Earlier in the day, at the 42nd annual general meeting, shareholders approved the annual dividend payout of 200% per share (Rs 2 per equity share) for the year ended March 31, 2015.
Onkar S Kanwar, chairman, said: “In a slow-growth market across geographies, further marred by unregulated imports of tyres in India, we have planned and invested to capitalize on future opportunities. This strategic planning will reduce dependence on a particular market for growth and help us expand global footprint.”