Apollo Tyres is planning big. Having grown into a $2-billion company in 35 years since inception in 1976, India's largest tyre maker now plans to grow three times to $6 billion in the next five years. The aim is to break into the global top 10 tyre companies. Apollo is reportedly ranked seventeenth now.
“We have set our ‘vision' to be a $6-billion company by 2015-16,” Mr Satish Sharma, Chief, India operations, said in Dubai on Wednesday. He was addressing an official dinner attended by the company's fast increasing family of channel partners in the Gulf countries and dignitaries from Dubai.
And, if he has his “way”, Mr Sharma expects the Indian operations to grow from the existing $1.2 billion to $3.5 billion in the next five years, leaving space for the European (Apollo Vredestein) and African (Apollo South Africa) operations to contribute the residual $2.5 billion. Together, Apollo Vredestein and Apollo South Africa currently generate revenues of approximately $800 million.
According to the ‘Vision' document, which was formalised at a recent meeting of the group management in Thailand, Apollo expects each of its operational bases to create new “home markets” to push export revenue.
While he did not say much on the African and European operations, Mr Sharma pointed out that the group flagship Apollo Tyres Ltd will henceforth consider Australia, Indonesia, West Asia and Turkey as its home (or export) markets.
Exports focus
While the Group has already increased focus on exports to the Gulf countries through the newly incorporated Apollo Tyres Middle East, in two to three years the company is likely to set up an office in Istanbul to grab a sizeable share of the 6 million passenger car tyre and 1.5 million commercial vehicle tyre market in addition to the truck- bus radials.
A bigger export plan is under implementation in Indonesia. Apart from the general demand for BIAS tyres and truck radials, the concentration of opencast mining activity offers a lucrative market opportunity for high tonnage (and high value) off-the-road (OTR) tyre market.
“We are manufacturing 51” – 57” high tonnage OTRs in India for exports to Indonesia. There is little market space for such products in India,” Mr Sharma told Business Line adding that two such consignments were exported to the archipelago.
The plan to enter the Australian market — offering market opportunities in almost all segments including car and truck radials to the OTRs — is still in the evolving phase. “We are using our European experiences and connections to enter this market,” he said.