The Hindu Business Line : Apollo increases truck, bus tyre prices by 3 pc

THE Rs 2,000-crore Apollo Tyres Ltd (ATL) has increased the prices of its commercial truck and bus tyres by up to 3 per cent. The increase comes nearly three months after the company went in for a 2.5 per cent hike in prices across its entire product range, which included truck and bus tyres.

ATL had also, on December 22, 2003, effected a 3 per cent to 4 per cent increase in the prices of its non-truck tyres — passenger car tyres, light commercial vehicle tyres and farm tyres.

Confirming the price increase on Apollo's truck tyres, Mr Satish Sharma, Chief-Marketing, ATL, said that the increase, effective from January 24, ranged between 1.5 per cent and 3 per cent on various brands.

A truck tyre manufactured in India is generally sold within the country at price levels of about Rs 9,000 per tyre (actual prices to customers vary depending on sizes, taxes, quality, location and discounts).

Mr Sharma said that the latest price increase was only confined to commercial truck and bus tyres.

This segment, which is known as the bread-and-butter segment of the industry, accounted for over 70 per cent of the turnover of the Rs 12,000-crore domestic tyre industry.

"We are still trying to offset the input price increase that happened in 2003," Mr Sharma said.

He also said that the recent import duty cuts (announced on January 9 — peak duty reduction to 20 per cent) would only have marginal benefit to Apollo Tyres.

"We may have had to go in for another round of increase in April. But now that the import duty cuts have happened, we may not need another increase," he said.

ATL's latest move to hike prices of commercial truck tyres comes close on the heels of the 3 per cent increase in truck tyre prices effected by J.K. Industries.

Rising input costs had dented the profit margins of Apollo Tyres in the first half of the current fiscal.

ATL had reported a net profit of Rs 36 crore on a net sales of Rs 1120.63 crore for the six-month period ended September 30, 2003.

The company had registered a net profit of Rs 48.97 crore on net sales of Rs 968.86 crore in the corresponding period during the previous year.