PROJECT REPORT ON

A STUDY ON CAPITAL STRUCTURE WITH SPECIAL REFERENCE OF APOLLO TYRES PERAMBRA, THRISSUR
Submitted in partial fulfilment of the Requirements for the award of The Degree of

MASTER OF BUSINESS ADMINISTRATION BY NEETHU FRANCIS Enrolment No. 10AMBFM 0981 Register No. 10 NFM 5981

FINANCIAL MANAGEMENT
Sakthan Thampuran College of Mathematics & Arts Thrissur, Kerala Centre Code: KL 130 Under the Guidance of JOJU MELAYIL T.A MBA, Managing Director of Sakthan Thampuran College of Mathematics & Arts And Jayaram Education Private Ltd. Thrissur.

BHARATHIAR UNIVERSITY SCHOOL OF DISTANT EDUCATION COIMBATORE 641046 MAY 2012

DECLARATION
I NEETHU FRANCIS hereby declare that this project work titled A STUDY ON CAPITAL STRUCTURE OF APOLLO TYRE PERAMBRA,

THRISSUR submitted to the Bharathiar University in partial fulfilment of the requirements for the award of the Degree of MASTER OF BUSINESS ADMINISTRATION and under the guidance of Mr. JOJU MELAYIL T.A, MBA, Managing Director Of Sakthan Thampuran College Of Mathematics & Arts, and Jayaram Education Private Ltd.Thrissur. And this project report has not been
submitted to any other university for the award of any Degree, Diploma,and Associateship, fellowship or my other similar title to any university.

DATE

Signature of the Candidate

NEETHU FRANCIS Enrolment No. 10 AMBFM 0981 Financial Management

Countersigned by Signature of the Guide (with seal) Signature of the centre Co-ordinator (with seal)

CERTIFICATE This is to certify that the project report titled A STUDY ON CAPITAL STRUCTURE OF APOLLO TYRES PERAMBRA, THRISSURSubmitted to
Bharathiar University in parial fulfilment of the requirements for the award of the Degree of MASTER OF BUSINESS ADMINISTRATION IN FINANCE is record of the original work done by NEETHU FRANCIS under my supervision and guidance and that this project work has not formed the basis for the award of any Degree, Diploma or fellowship or other similar titles of any university or institution.

(Seal)

Signature of the Guide JOJU MELAYIL T.A MBA, Managing Director of Sakthan Thampuran College of Mathematics &Arts Jayaram Education Private Ltd. Thrissur.

Forwarded by DIRECTOR, SCHOOL OF DISTANCE EDUCATION, BHARATHIAR UNIVERSITY COIMBATORE-46 Submitted for University Examination held on May 2012 ..

Internal Examiner

External Examiner

ACKNOWLEDGEMENT
First of all I am dedicated this humble and sincere work of inline to God almighty for shower strength and blessing he has bestowed on the for doing this work. With great happiness I submitted this project entitled A STUDY OF CAPITAL

STRUCTURE OF APPOLO TYERS PERAMBRA, with due respect for invaluable

suggestions made by esteem well wishers. I take this opportunity to express my sincere thanks and sense of beloved principal Mr.

gratitude to my

Ajith Kumar Raja .M and co-ordinator institution. I express my Mr.JOJU MELAYIL T.A for the advices, suggestions and

gratitude to the project guide guidance provided.

I acknowledge my sincere thanks to the

I would like to thank my parents, family, friends and wishes for contributing their skills, creativity and much need help.

NEETHU FRANCIS

SYNOPSIS
Apollo Tyres is a Public Limited company. Company suggested doing the project on capital structure by using financial leverage analysis to know the financial position of the company. The capital structure of a business is the mix of the types of debt and equity. The company has own its balance sheet. One of the main factors affecting the capital structure of a business is leverage. Leverage are three types-operating leverage, financial leverage and combined leverage. Here the study is given more emphasis to the financial leverage only. Financial leverage defined as the ability of a firm to use fixed financial charges to magnify the effects of changes in EBIT or operating profits, on the firms Earning Per Share (EPS). The main aim of the study is the capital structure of the company by using financial leverage techniques. The research type is historical in nature. Data collection is done through secondary sources (Annual Reports, websites etc). Data analysis is done with the help of ratio analysis (leverage ratios). Leverage or solvency ratios are used to analyse the long-term financial position (capital structure) of a business. Tables and bar graphs are used for making analysis more clear and understanding. After the study it reveals that APPOLO TYERS is maintaining sound financial position.

INTRODUCTION OF THE STUDY

Finance has become so much important for every business undertaking that all managerial activities are connected with it. Financial viability of various propositions influence decision on them. Finance function has become so important that it has given birth to financial management as a separate subject. Financial management refers to that part of the management activity, which is concerned with the planning and controlling of firms financial resources. The resources must be suitable and economical for the needs of the business. The basic task of a finance manager is the procurement of funds and the basic objective of financial management is wealth maximisation. The finance manager is required to select such a finance mix or capital structure, which maximises shareholders wealth in procurement of funds. For designing the optimal capital structure, he is required to select such a mix of sources of finance so that overall capital is minimum. The funds required by a business enterprise has to can be raised either through the ownership securities ie, Equity shares and preference shares or creditor ship securities ie, Debentures onds.

The financial or capital structure decision is of tremendous significance for the management, since it influences the debt-equity mix of the company, which ultimately affects shareholders return and risk. Financial management is applicable to every type of organisation irrespective of its size , kind or nature. It is as useful to a small concern as to big unit. In the case of borrowed fund are more when compared to the owners funds, it results in increase in shareholders earnings. Whether the organisations status profita le or not for this purpose to analyse the capital structure is compulsory. So the researcher as selected the topic The Capital Structure of the Apollo Tyres. Capital structure is the permanent financing of the company represented primarily by long term debt and shareholders funds but excluding all short-term credit. Thus, a companys capital structure is only a part of its financial structure.

NEED FOR THE STUDY

The study of capital structure is conducted to identify the financial structure of APOLLO TYRES. The study helps to give information about debt ,equity, and profitability, etc.It helps to understand the profitability of the organisation. Capital structure of the company is mainly depends upon the profitability of the organisation. The capital structure of the company should be most profitable ie, Is on that tends to minimise cost of financing and maximise earning per equity shares

THEORETICAL FRAME WORK

INTRODUCTION
The capital structure of a business is the mix of types of debt and equity the company has on its balance sheet .The capital ownership of a business can be evaluated by knowing how much of the ownership is in debt and how much in equity .The company ,s debt might include both short-term debt and long-term debt (such as mortgages),and equity ,including common stock, preferred shares, and retained earnings. Capital structure can affect the value of a company by affecting either its expected earnings or the cost of capitals or both. The capital structure decisions can influence the value of the firm through the earnings available to the share holders.

MEANING OF CAPITAL STRUCTURE

Capital structure required in a business may be raised .capital structure means the composition of the firms financing consisting of equity, preference and debt. Some of the authoritive definitions are as follows According to Gerstenberg ,capital structure means' the makeup of a firms capitalization' .In other words ,it represents the proportional mix of equity share capital , preference share capital ,internal sources ,debentures , and other sources of funds in the total amount of capital which an undertaking may raise for establishing its business . Capital structure of the firm is the combination of different permanent long-term financing like de t, stock, preferred capital etc .

OBJECTIVES OF CAPITAL STRUCTURE

The Objective of the capital structure decisions is 'Judicious use of different long- term sources of financing such that the overall cost of capital of the firm does not increase and remains minimum and constant ,thereby maximizing the value of the firm '.The determination of capital structure is necessary both at the time of establishment of the business enterprise and at any time ,the firm changes its capital structure .However the fund managers it should always take care that this optimal capital structure is kept flexible enough to take care of solvency threat and other bankruptcy costs.

FACTORS AFFECTING CAPITAL STRUCTURE

There are three major factors affecting capital structure ie, risk, cost of capital and control determine the capital structure of a particular business undertaking at a given point of time, the finance manager attempts to design the capital structure in such a manner that his risk and costs are the least and the control of the existing management is dilated to the least extent. However, there are also subsidiary factors like marketability of the issue, maneuverability and flexibility of the capital structure and timing of raising the funds.

Risk Cost of capital Control Leverage Size of the company Dilution of control
Floatation cost

Cash flow projections of the firm Lenders attitude Management attitude Sales of stability Risk
Risk is two kinds, financial risk and business risk. Financial risk is also is of two types: a. Risk of cash insolvency

b. Risk of variation in the expected earnings available to equity shareholders

Cost of capital
Cost is an important consideration in capital structure decision .It is obvious that a business should be at least capable of earning enough revenue to meet its cost of capital and finance its growth.

Control
Along with cost and risk factors, the control aspect is also an important consideration in planning the capital structure .When a company issues further equity shares , it automatically dilutes the controlling interest of the present owners.

Leverage
By use of fixed costs financing (source of funds having fixed cost like debt, preferred, capital for which the firm pays fixed interest ,fixed preferred dividend respectively; Interest payments preferred dividend payments are fixed in nature hence we say that their cost is also fixed) profitability of the firm is magnified and enhanced due to leverage effect (leverage firm uses debt as a source of finds .By using debt the firm is able to decrease tax payable thereby increasing profits).

Size of the company

As size of the company increases so does its requirement of funds due to large operational activities. The capital structure is very prominent and critical for such a firm. A slight change in capital structure may affect the overall profitability of the firm.

Dilution of control
A firm that issues more and more equity dilutes the power of existing shareholders as number of shareholders increases. Hence the investors, to an extent, prefer to new issue of equity.

Floatation cost
It is the cost involved in issuing a security or a debt. If such cost is too high for new issue of any component of capital structure, then the use such source of fund is minimized

Cash flow projections of the firm

With use of each type of fund, related cash flows (benefits and costs) arise. If cash inflows (benefits) are higher than the cash outflows (costs) by employing the funds productively then that component of capital is profitable for the firm and hence it should adopt a capital structure with large proportion of that component of capital.

Lender's attitude
If lenders have a very strict and restricting attitude towards the borrower on the use of the lended amount of funds, then the profitability of the firm is greatly hampered .The normal activities and dynamism of such enterprise is restricted and limited to the fulfilment of the lender's personal objectives only. Such funds should not be encouraged to be used by the firms. If they have been borrowed then repayment of such funds should be done as soon as possible.

Management attitude
If directly influences the choice of capital structure of the firm. A conservative attitude opts for zero debt in its capital structure .Use of debt increases the financial risk of the firm and even increases the risk of bankruptcy and insolvency .An aggressive attitude opts for high use of debt ie ;financial leverage and increases the financial risk of the firm.

Sales stability
Greater is the stability of sales and earnings of a firm the better is its position to pay of its debt (principal + interest) .Thus the firm can opt freely for debt as a medium of financing without any risk (risk of not being able to pay off debt due to low /zero operating profits).

ASSUMPTIONS OF CAPITAL STRUCTURE THEORIES

1. There are only two sources of funds used by a firm .Perceptual riskless debt and
ordinary shares.

2. There are no corporate taxes. This assumption is removed later. 3. The dividend pay out ratio is 100. This is, the total earnings are paid out as dividend to
the shareholders and there are no retained earnings.

4. The total assets are given and do not change. The investment decisions are, in other
words, assumed to be constant

5. The total financing remains constant. The firm can change its degree of leverage
(Capital structure) either by selling shares and use the proceeds to retire debentures or by raising more debt and reduce the equity capital.

6. The operating profits (EBIT) are not expected to grow. 7. All investors are assumed to have the same subjective profitability distribution of the
future expected EBIT for a given firm.

8. Business risk is constant overtime and is assumed to be independent of its capital

structure and financial risk

9. Perceptual life of the firm APPROACHES FOR CAPITAL STRUCTURE THEORIES

There are 4 major theories/approaches explaining the relationship between capital structure, cost of capital and value of the firm 1. Net Income Approach ( N.I. Approach) 2. Net Operating Income Approach (N.O.I. Approach) 3. Traditional Approach 4. Modigliani and Miller Approach (MM Hypothesis) i. Net Income Approach(N.I. Approach)

This approach was suggested by Durand David. According to this approach, a firm can increase its value or lower the overall cost of capital by increasing the proportion of debt in the capital structure. In other words, if the degree of financial leverage increases, the weighted average cost of capital will decline with every increase in the debt content in total funds employed, while the value of the firm will increase. Reverse will happen in a convers situation. Net Income Approach is based on the following assumptions The cost of debt is less than cost of equity or equity capitalization rate, and The use of debt content does not change the risk perception of investors as a result both the Kd (debt capitalisation rate) and Ke (equity capitalisation rate) remains constant. There are no corporate taxes;

The value of the firm on the basis of net income approach can be ascertained as follows: V=S+B Where, V= Value of the firm S= Market value of equity or stock B/D = Market value of debt However, market value of equity (S) can be ascertained as below: Market value of equity (S) =NI Ke Where, NI = Net Income (Earnings available for two equity shareholders) Ke = Equity capitalisation rate Under NI approach the value of the firm will be maximum at a point where weighted average cost of capital is minimum. Thus, the theory suggests that use of maximum possible debt financing will minimize the overall cost of capital The overall cost of capital under this approach can be calculated as below; Overall cost of capital = EBIT Value of firm 2.Net Operating Income Approach (N.O.I. Approach) This approach was suggested by Durnad David . According to this approach, the market value of the firm is not affected by the capital structure changes. The market value of the firm is ascertained by capitalising the net operating income at the overall cost of capital that is constant. The market value of the firm is determined as follows:

Market value of the firm (V) = Earning before interest and tax (EBIT) Overall cost of capital = EBIT 9Ko The value of equity can be determined by the following equations: Value of equity(S)= V(market value of firm) B(Book value of debt) Therefore, the cost of equity can be calculated by the following formula: Cost of equity = Net Income available to equity shareholders Market value of equity

Ke = Ko + (KO Ka ) B/S The Net Operating Income Approaches is based on the following assumptions;

i. ii.

The overall cost of capital remains constant for all degree of debt-equity mix The market capitalizes the value of firm as a whole. Thus, the the split between debt and equity is not important

iii.

The use of debt funds increases the risk f shareholders. This causes the equity capitalisation rate to increase. Thus, the advantage of debt is set off exactly by increase in equity capitalisation rate.

iv. v.

There are no corporate taxes. The cost of debt remains constant

Under NOI approach, the overall cost of capital is constant, therefore, there is no optimal capital structure, rather every capital structure is a good as any other and so every capital structure is optimal one.

3. Traditional Approach The traditional approach is also called an intermediate approach as it takes a midway between NI approach (that the value of the firm can be increased by increasing financial leverage) and NOI approach (that the value of firm is constant irrespective of the degree of financial leverage). According to this approach, the firm should strive to reach the optimal capital structure and its total value through a judicious use of the both debt and equity in capital structure. At the optimal capital structure, the overall cost of capital will be minimum and the value of the firm is maximum. It further states that the value of the firm increases in financial leverage up to a certain point. Beyond this point, the increase in financial leverage will increase its overall cost of capital and hence the value of the firm will decline. This approach partly contains features of both the NI and NOI approaches as given below: i. The traditional approach is similar to NI approach to the extent that it accepts that the capital structure or leverage of the firm affects the cost of capital and its valuation. However, it does not subscribe to the NI approach that the value of the firm will necessarily increase with all degree of leverages. ii. It subscribe to the NOI approach that beyond a certain degree of leverage, the overall cost of capital increases resulting in decrease in the total value of the firm. However, it differs total value of the firm. However, it differs from NOI approach in the sense that the overall cost of capital will not remain constant for all degrees of leverage. Thus as per the traditional approach, the cost of capital is a function of financial leverage and the value of the firm can be affected by the judicious mix of debt and equity in capital structure. The increase of financial leverage up to a point favourably affects the value of the firm. At this point, the capital structure is optimal and the overall cost of capital will be the least. Traditional approach states that moderate degree of financial leverage (use of debt) increases the cost of equity but not to a very large extent as proposed by MM approach. Cost of equity increases slowly at first when Debt Equity Ratio is increased but after a point as debt increases further, cost of equity increases at an accelerated rate.

4. Modigliani and Miller Approach/Theory The Modigliani- Miller (MM) approach is similar to the Net Operating Income (N.O.I) approach. In other words, according to this approach,the value of a firm is independent of its capital structure . However, there is a basic difference between the two. The N.O.I. approach is purely definitional or conceptual. It does not provide operational justification for irrelevance of the capital structure in the valuation of the firm. While MM approach supports the N.O.I. approach providing behavioural justification for the independence of the total value and the cost of capital of the firm from its capital structure. In other words, MM approach maintains that the weighted average cost of capital does not change with change in the debt equity mix or capital structure of the firm.

INDUSTRIAL PROFILE
History of tires:
The most important application of rubber relates to the transport sector of

which tyre industry consumes over 60% of the total rubber produce. During the last 20 years tyre has been virtually reinvented with most modern technologies like steel radial tyres, a milestone in the tyre technology. Tyre sector is experiencing a rapid improvement with the advent of newer technologies. The tyre industry egin to grow in India during 1930s.The growth of tyre

industry in India may be divided into 3 phase. In the first phase, multinational came to India and started selling tyres. The first among them was Firestone followed by multinational like Good year Dunlop etc. In the second phase multinationals started their production in become the first generation tyre company. Dunlop production. The third phase of tyre industry producing egan, where Indian companys started was India. Then they

the first company started the

tyres ,which come to be called second generation tyres The important

among them are MRF tyres ,Good Year, CEAT etc. The main third generation tyres are Apollo tyres , Vikrant tyres, JK tyres, Modi tyres etc. The entire tyre companies which started after 1970s and the companies,

which are yet to start production are classify under the head fourth generation tyres.

World Scenario
The world tyre industry is worth around US $ 70 billion. The industry is marked by the presence of around half a dozen major players who together occupy to 70% of the world market share.

Company Market share-:

COMPANY
Michelin Bridgestone Goodyear Continental Sumihomo Pirelli Yokohama Kumho Others

MARKET SHARE
19.4 19.4 16.6 7.1 4.9 3.9 3.5 1.7 23.5

INDIAN SENARIO Salient features of Indian tyre industry:

Adaptability and absorption. Exports Innovations Indigenous and ready availability Technology progression Wide product range for diverse use Self- sufficiency and vibrant marketing setup

Highlights of the Indian Tyre Industry:

The tyre industry is a Rs. 9,000 crore industry. The fortune of this industry depends on the agricultural and industrial performance of the economy, the transportation needs and the production of vehicles.

While the tyre industry is mainly dominated by the organized sector, the unorganized sector holds sway in bicycle tyres.

In the last five years (1994-95 to 1998-99), the industry managed to achieve a compounded annual growth of only 4.40 per cent. However in the last fiscal the industry registered a growth of 7 per cent.

Natural rubber constitutes 25 per cent of the total raw material cost of the tyres. The ratio of natural rubber content to synthetic rubber content is 80:20 in Indian tyres, whereas world wide, the ratio of natural rubber to synthetic rubber is 30:70.

Ranking of Indian tyre companies on the basis of production:

1. MRF Tyres Limited

2. Apollo Tyres Limited 3. JK Tyres Limited 4. CEAT Tyres Limited 5. Modi Rubber Tyres Limited 6. Birla Tyres Limited 7. Good Year India Limited
8. Vikrant Tyres Limited

Domestic Rank:
Segment Companies Apollo Tyres JK Tyres MRF CEAT Truck 1 2 3 4 Light Commercial Vehicle 2 4 3 1

Market share of Companies in the Indian Tyre Industry:

Companies MRF Apollo Tyres JK Tyres CEAT GOOD year Others % share 24 22 17 14 6 17

COMPANY PROFILE:

The history of Apollo tyres can

e traced

ack 70s when

MNCs and Indian tyre majors dominated the tyre industry. Apollo Tyres Ltd a leader in the Indian tyre industry and a significant global player, providing customer delight and enhancing shareholder value was registered in 1972. The license was

firstly given to Ruby Rubber works to start a tyre factory at Changanassery. In 1975 Raunaq Singh purchased the license from Ruby Rubber works. It is one of the flagship companies of Raunaq group. The plant is situated at Perambra 50 km north of Cochin. Total area covered where 97 acres which was bought from people who stayed there by, at cheaper rate. At the starting time the production capacity was 54 tones per day. The Apollo tyre ltd owned by Raunaq group of industries place an important rolling world tyre industry. The products include tyres , tubes and flaps for all vehicles. The head office of company is at New Delhi and registered office is at

cochin. The main marketing activities are concentrated in New Delhi and around 2400 exclusive dealers for Apollo cover the entire area of India. During 1977 to 1981 the company was under heavy loss. The capacity utilization was only 40 to 50 % capacity. The emphasis is given on growth quality and objectives are redefined when Mr .Onkar S

Kanwar took over the

companys affairs . Company

began to earn profit and

accumulated losses of 26 crores could be wiped out with short spam of time. There second plant was installed at Limda village at Baroda in Gujarat, which started production in 1991 having capacity of 6.5 lakh tyre/annum. This is most modern plant. The R&D centre is also functioning at this location. The third plant at kalamassery was taken over by Apollo from Premier tyres

.While take over this plant was a sick unit. After the takeover Apollo spent a good amount in modernizing the plant and now it is profit earning unit. The fourth plant

was commissioned in 1996 at pune for manufacturing tubes. The entire requirement of tubes for all plants of Apollo is done from here.

MISSION: A journey called agile to be a us$6 billion company by the year 2016. VISION
A leader in the Indian tyre industry and a significant global player, providing customer delight and enhancing shareholder value.

VALUES:
The one word that symbolizes all that we believe is CREATE. C - CARE FOR CUSTOMERS. R - RESPECT FOR ASSOCIATES. E - EXCELLENCE THROUGH TEAM WORK. A - ALWAYS LEARNING. T - TRUST MUTUALLY. E - ETHICAL PRACTICES.

GOALS:

Creating Social Responsibility. Learning & Development. Family Focus. Hygienic Factors. Employee Involvement & Cultural Building.

Parambra Plant Vision:

Its be the most successful profit Centre through innovation, capacity expansion and by embracing newer technologies and work culture, thus synergizing our efforts to achieve cooperate goals.

Quality Policy:
We will achieve customer delight by striving for excellence in the quality of our products and services using a fact based approach for continual improvement that ensures all processes contribute to business success.

Management Board:

Mr. Onkar S Kanwar Mr .Neeraj Kanwar Mr. Luis C Ceneviz Mr.Gaurav Kumar Mr.Tapan Mitra, Mr.P K Mohamed Mr.Rob Oudshoorn Mr.Kaushik Roy

: Chairman and Managing Director : Vice Chairman and Managing Director : Chief, Africa Operations : Group Head, Corporate Strategy & Finance : Chief, Human Resources : Chief Advisor, Research & Development : Chief, Europe Operations : Group Head, Corporate Purchase

Mr.Sunam Sarkar Mr.Satish Sharma

: Chief Financial Officer : Chief, India Operations

MILESTONES OF APOLLO TYRES:

1972 The companys license was o tained Thomas and associates. y Mr. Mathew T. Marattukalam, Jaco

1974

The company was taken over by Dr. Raunaq Singh and his associates.

1975

April 13, foundation stone of the Perambra plant was laid.

1976

Apollo Tyres was registered.

1977

Plant commissioned in Kerala with 49 TPD capacities.

1982

Manufacturing of Passenger Car Radial Tyres in Kerala

1991

Second plant commissioned in Baroda.

1995

Acquired Premier Tyres Ltd in Kerala.

1996

Exclusive tubes plant commissioned in Ranjangaon

2000

Exclusive radial capacity established in Baroda.

2003

Radial Capacity expanded to 6600 Tyres per day.

November 17, Joint Venture with Michelin.

2004

Launch of Apollo Aclere-H Speed Rated Car Radials.

2005

April 13, Perambra plant completes 30 years.

2006

January 30, Acquires Dunlop South Africa. August 7, Announced the launch of new plant in Chennai.

2007

Launch of Regal Truck and bus radial tyres

2008

Apollo Tyres Ltd. announced the public Greenfield plant to be ready by 2010 for the European markets

2009

Apollo Tyres Ltd. Announced the acquisition of VBBV Tyres, Netherlands.

2010

Apollo won an agreement with Volkswagen AG to supply the VW Polo assembled in India

MANUFACTURING CENTRES:
Corporate office - Gurgaon Other plants in India:- Baroda - Pune - Perambra

- Kalamassery - Chennai International plants:Zimbabwe South Africa - Bulawayo - Ladysmith, - Durban

Organisation details;
Name Place : Apollo Tyres Ltd. : Perambra, Thrissur (50 Km north of Kochi, Kerala)

Year of Inception: 1976 Land Area : 97 acres

Building Area : 69500 sq.mts Head Office : New Delhi

Registered Office : Kochi , Kerala Present capacity : 340 MT per day Product range : Truck, LCV, REAR TRACTORS, FARM RADIALS, PASSENGER & ADV TYRES No. of people: 2790 MAN POWER Number of employees in the Apollo CATEGORY Management NUMBER 270

Staff Permanent staff Workman Trainees Contract Workman Total 2790 453 1819 248

Working Hours:
Shift A : 6 AM 2 PM Shift B : 2 PM 10 PM Shift C : 10 PM 6 AM Shift D (general): 9 AM 5 PM

Departments:
There is a high degree of departmentalisation in Apollo Tyres Ltd. The departmentalisation helps in specialization of work in each field. It helps in better planning and better concentration in the particular work handled by a particular department. The various departments in Apollo Tyres Ltd are as follows; 1. Human Resource Department a) HR and Industries Relations b) Security and training c) Safety and First Aid d) Time Office 2. Stores a) Raw Material Stores b) Engineering Material Stores c) Finished Goods Stores

3. Purchase Department 4. Industrial Engineering Department 5. Quality Assurance Department 6. Accounts & Finance Department 7. Systems 8. Production Planning & Control a) Production A b) Production B c) Production C Perambra Plant (in Focus): Single largest truck tyre plant in India. Fastest growing plant in Apollo family. It is known as the mother plant. Continuous expansion. Total employee involvement.

NEW PRODUCTS OF APOLLO, PERAMBRA 11.00 20 SL 9 8.25 -20 KAIZEN KZ XLM 8.25 20 LSS GOLD 8 -18 KRISHAK PREMIUM 5.00 15 KRISHAK PREMIUM 4.75 14 KRISHAK PREMIUM 13.00 20 XTRAX GRADER 14.00 24 XTRAX GRADER 23.1 26X TRAX ROAD COMPACTOR APOLLO KEY DIFFERENTIATION TO OTHER FIRMS:
Superior product Quality. Strong Brand Equity.

Committed Marketing Team. High Consumer Loyalty Product Segmentation in Truck Tyres. Benched marked for planning efficiency parameters. Power consumption. Quick response to market needs. Fuel efficiency. Least scrap generation.

HIGHLIGHTS OF APPOLLO TYRES LTD:

7th fastest growing Tyre Company in the world. 17th largest Tyre Company in the world. First Tyre Company in India to obtain ISO9001 certification for all its operations. First Company to introduce packaging for tubes, two wheeler Tyres and Car Tyres.

GOLDEN ACHIEVEMENTS:
Apollo Tyres Ltd Perambra unit was ranked the first among large scale

industries

for productivity and energy conservation in the year 2002-2003 by

Kerala state productivity council. Apollo Tyres Ltd received the pollution control award by the government during the year 2003-2004 ATL group crossed a turnover of a billion US $ during 2006-2007 ATL group was announced as a leader in Indian Tyre Industry and as a significant global player providing customer satisfaction and enhancing shareholder value central

PRODUCT PROFILE:
1. TRUCK

Overload Technology

Loadstar Super. Loadstar Super Gold. Loadstar Super Hercules. Kaizen 50L. XT7. XT7 Gold. XT7 Haulug. Amar Delux. Amar. Commando. Kaizen 36L Kaizen 99R plus Kaizen 77R XT9 XT9 Gold Amar Gold Kaizen XTD Champion Champion Gold Champion DXL Amar AT Rib Kaizen 27L

Load & Mileage Technology

Premium Mileage Technology

Mileage Technology Segment

2. LIGHT COMMERCIAL VEHICLE:

Overload Technology Loadstar Super. Mile star

Load & Mileage Technology

Premium Mileage Technology

Amar De lux Amar Gold Rib XT9 XT9 Gold(lug) Dura mile (radial)

Regular Mileage

Champion

3. PASSENGER CAR RADIALS:

Tubeless Radial Passenger Car Amazer XL Acelere Tubeless Radial MUV & SUV Hawks

Tube type Radial for Passenger Car

Amar Amazer XL Quantum Amar Amazer XL Storm Hawks

Tube type Radial MUV & SUV

Passenger Car & Jeep Bias

Armour Panther Gripper Maha Trooper

4. FARM:
Cultivation Krishak Super Sarpanch Haulage Power Haul

Multipurpose

Farm King (Radial) Krishak Premium (bias)

Tractor Trailer Types

Dhruv Hunter

AWARDS & RECOGNITIONS National Safety Council Award 2005, 2006, 2008. Kerala State Pollution Control Board Award 03-04, 06-07. Best Productivity Award 2006-2007 (MKK Nayar Memorial Award) . Best Productivity Award 2007-2008 (MKK Nayar Memorial Award). State Energy Conservation Award 2007- second prize (Large Scale Enterprises). Kerala State Safety Award from National Safety Council 2007. Top Duty Payer Awards from Central Excise 2007-2008. India Manufacturing Excellence Award Gold Certificate of Merit 2008. Outstanding Performance in Industrial Safety Award 2008 (Govt. of Kerala). Kerala State Level Quality Circle Competition 2009, CII. Kerala State Energy Conservation Award 2009, EMC Kerala. Department of Factories & Boilers safety Awards 2010. Best in Innovative HR Practices KMA 2010. Innovative Cost Management measure implemented KMA 2011. Innovative HR Practices implemented KMA 2011.

Capital Structure (Apollo Tyres)

Period
From To

Instrument

Authorized Capital
(Rs. cr)

Issued Capital
(Rs. cr)

-PAIDUPShares (nos) Face Value Capital

2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1989 1987 1985 1984 1983 1981

2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1988 1986 1985 1984 1983

Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share Equity Share

73 73 73 73 73 48 48 48 48 48 48 48 48 48 48 48 48 48 48 48 10 10 10 10 10

50.4 50.4 50.4 48.84 46.4 38.34 38.34 38.34 36.32 36.32 36.32 36.32 33.05 30.04 29.87 29.45 27.88 27.88 27.88 27.88 8.4 7.75 7.75 7.39 6.7

504024770 504024770 504024770 488444770 46402477 38337977 38337977 38337977 36315477 36315477 36315477 36315477 33054420 30040104 29874898 29457509 27879350 27879350 27879350 27879350 8402000 7750000 7750000 7386300 6697350

1 1 1 1 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10

50.4 50.4 50.4 48.84 46.4 38.34 38.34 38.34 36.32 36.32 36.32 36.32 33.05 30.04 29.87 29.46 27.88 27.88 27.88 27.88 8.4 7.75 7.75 7.39 6.7

1980 1978 1976 1972

1981 1979 1977 1976

Equity Share Equity Share Equity Share Equity Share

10 10 10 10

6.7 6.47 7.75 7.75

6696050 6466000 7750000 77

10 10 10 10

6.7 6.47 7.75 0