Apollo Tyres today recorded an over two-fold jump in its net profit at Rs 116.1 crore for the quarter ended March 31, driven by a robust performance in domestic as well as international markets.
The company said that it has earmarked a capital of Rs 1,100 crore this fiscal to be utilised for various purposes, including operational expenses and a 20 per cent increase in capacity.
Apollo Tyres had recorded a net profit of Rs 46.2 crore in the corresponding quarter of the previous fiscal.
During the fourth quarter, the company's net sales surged by 18 per cent to Rs 1,312.7 crore from Rs 1,110 crore in the same period of the financial year 2008-09.
In the year ended March 31, 2010, the company saw a near five-fold jump in its consolidated net profit to Rs 653.3 crore from Rs 139.1 crore posted in the year-ago period.
During the last fiscal, the company's consolidated net sales increased nearly two-fold to Rs 8,120 crore from Rs 4,984 crore recorded in the previous fiscal.
The city-based tyre-maker attributed the huge jump to the integration of Netherlands-based Apollo Vredestein, which was acquired in May 2009, besides an increase in demand in the domestic market.
"Increase in domestic sales, together with the integration of our recent acquisition of Vredestein, primarily contributed to our top-line growth," Apollo Tyres chief financial officer Sunam Sarkar told PTI.
He said that the company is looking at a 20 per cent growth in the current fiscal.
"In the current fiscal, we expect to grow by 20 per cent. European markets would be the focus area for this year," Sarkar said, adding that the company is gearing up to launch Apollo-branded tyres in the European market within the next few days.
Speaking on the company's capital expenditure programme, he said that the company has earmarked an investment of Rs 1,100 crore for fiscal year 2010-11, of which a major chunk would go into enhancing its production capacity.
"Our capex for this year is Rs 1,100 crore. We will be investing on capacity expansion, maintenance and other operational expenditures... We are looking at an additional capacity ramp-up of around 20 per cent this year," Sarkar said.
At present, Apollo Tyres has nine plants across the globe with a total production capacity of 1,200 tonnes a day.
Sarkar said that though the surging input cost is a challenge, the firm is not looking at hiking the prices.
The company, which raised its tyre prices by 3.5 per cent in May, has announced a further similar hike in the next month.
