Leading tyre manufacturer Apollo Tyres, which has drawn up an ambitious target of reaching $5 billion by 2025-26, is bullish on the Indian and global economies and has started mapping possible scenarios for the coming months.
“Despite the uncertainty of the third wave, I remain bullish on the strength of the Indian and global economies,” said chairman Onkar S. Kanwar, addressing the 48th AGM.
He said the pandemic had made them to work with renewed vigour towards cost reduction and in enhancing manufacturing efficiencies across the organisation.
“You have known your company as an agile and a resilient company. We were quick to understand the gravity of the pandemic and immediately launched initiatives to check on our costs,” he said.
During FY21, Apollo Tyres differentiated between good cost and avoidable cost, Mr. Kanwar said.
The company continued to invest in good costs such as R&D and marketing and drastically reduced other costs. It also renegotiated advertising costs and re-looked at warehousing expenses, he added.
“It is my firm belief that we need to drive unnecessary cost out of our business, as that is the delta between a profitable and a losing organisation in this increasingly global industry,” he said.
He also recalled the 2008 global recession, during which time the company had invested close to ₹3,000 crore in a greenfield project in Chennai. That was the best timing for the investment as Apollo Tyres got a lead over all competitors in India by nearly 18 months.
Similarly, even during the pandemic, Apollo Tyres commissioned its seventh manufacturing unit globally and the fifth in India, in Andhra Pradesh, inaugurated a two-wheeler radial tyre facility in Gujarat, made product launches and expanded its dealer network virtually and digitally, he said.
Mr. Kanwar said that they recently unveiled the Vredestein brand and its specially designed product portfolio for the North American market, and in India Apterra Cross, a tyre for compact SUVs.
“All these initiatives helped us to bounce back, gain market leadership in various segments and helped us end the fiscal on a healthy note with robust revenue growth across market segments and geographies,” he said.
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