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Apollo Tyres will consider listing its international assets abroad, and look at entering China as it ramps up ambitions to be one of the world’s top 10 tyre manufacturers.
Speaking to BusinessLine in London, Vice-Chair and Managing Director Neeraj Kanwar said that the company was building up to a listing of its international assets in the next four-five years, as it raises marketing budgets and strengthens brand awareness across markets, including Europe, South-East Asia, Latin America and West Asia, and invests in research and development in new technology in Europe and India.
Currently, India accounts for 55 per cent of its revenues, though Kanwar sees the ratio evening out at 50:50. “I will look at eventually creating good value out of the international business. This brand exercise and technology journey is primarily to do with that. And then at the right time I will look at an international listing of the international business,” Kanwar said.
Expanding presence Apollo Tyres will also consider increasing its presence in the US and is “seriously” looking at China.
“I cannot ignore China. If our ambition is to become a top 10 in the world, we cannot ignore the US or China. I don’t have anything right now — eventually one has to enter those markets,” he said. Kanwar had previously spoken of being wary of China, following the collapse of the Cooper Tire deal, which failed because of the reservations of its joint venture partner in China.
While Apollo Tyres has no acquisition plans at the moment, growth would happen through a mix of organic growth and acquisitions. “We are growth oriented and we want to go to new continents,” said Kanwar.
Europe plans Apollo Tyres is currently reviewing plans for 2020, (but) the initial ambition is to be a $6-billion company by 2016. It hopes the Hungarian venture, into which it has invested around €475 million, will raise its market share in Europe to around 3 per cent.
“Europe gives me a stepping-stone into technology and creating brands because that’s the main thing going forward. In the next five years we are emphasising building both brands and technology. If we get this right the sky is the limit.”
Also read: ‘We cannot ignore the US or China’
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