To invest Rs. 4,000 cr on capacity expansion at Chennai centre.
Apollo Tyres has entered the two-wheeler segment with the launch of the ‘Acti’ series.
One of the leading tyre makers in the country, the company also said that it will invest Rs. 4,000 crore in the next financial year to expand its bus, truck tyres in Chennai.
Designed and developed at the company's global R&D centre in Chennai, the Apollo Acti series for bikes and scooters would cover nearly 85 per cent of the replacement market for two-wheeler tyres in India, the company said on Monday.
“The presence in the two-wheeler segment will help the company cement its leadership position in India. The Apollo Acti series will provide the best value proposition to our customers along with an enjoyable driving experience,” Onkar S Kanwar, Chairman, said here at the launch.
The two-wheeler category, which is growing at a CAGR of 8.5 per cent in India, holds huge potential for tyre manufacturers, the company said.
The company said it is looking at selling 1.20 lakh tyres each month initially, going up to five lakh tyres each month in the next two years. However, the company is sourcing the tyres from one of its vendors in Chennai and will decide on setting up a new plant or investment for two-wheeler tyres in the future.
“It depends on demand and branding of the tyres. We will be outsourcing the tyres for the next two years and we will decide on a greenfield or brownfield when the time comes,” Neeraj Kanwar, Vice-Chairman and Managing Director, told reporters.
To expand its existing tyre plants and capacities, Kanwar said Apollo will invest $600 million (around Rs.4,000 crore) next financial year to enhance capacity at its plants in India (Chennai) and abroad (Hungary).
He added that the company is also in the process of doubling the capacity of its Chennai plant to 12,000 truck and bus radials a day from 6,000 earlier.
The company’s shares closed at Rs. 170.35 on the BSE on Monday, up 2.65 per cent from the previous close.
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